Stock market and the Real Estate has always been a close competition. The answer to the question of whether one should invest in the stock market or real estate has been very confusing always. Investing in stocks, whose market can go up and down anytime or investing in real estate where your money seems safe, what to choose? This choice can depend on individual interests and preferences. Both the stock market and the real estate have their own pros and cons. So, you don’t need to worry anymore. Let’s discuss which one is better and for whom.
Being a part of the stock market means that being a part of a company. Simply put, buying a share of stock means buying a piece of a company. Now you are a part of that company’s loss and profit. If that company makes profit, you get your share of that profit. If you own 1 percent of the company’s shares, you own that much of its profit and loss.
- You do not have to do much except for researching each company to know if it’s right for you. Apart from this, you do not have to put any effort into this piece of business that you bought.
- It is easier to expand in stocks than investing in real estate. Using mutual funds, you can invest only $100 per month, unlike real estate, where you need to invest an enormous amount of money.
- The stock market is considered very much liquid than the real estate market. You can sell your stocks in seconds as many times as you want, while in case of real estate, you need to put up the property for days, months, before selling it.
- The price of the stock fluctuates very much. It may go from $40 to $10 or to $80 within seconds.
When you buy a physical property or say land, then is when you are investing in real estate. Sometimes what happens is that a real estate property costs you monthly. You may be thinking of selling it out, but till the time you sell it, you will have to pay for its maintenance. But on the other hand, the cash generating real estate properties may come as an asset to you. You can buy a property and give it on rent. The tenant gives you rent every month for a property that you bought and hence now, you can generate a proper amount of income from your real estate investment. You can pay your expenses from this money and save the difference as profit.
But then real estate also comes with its pros and cons.
- Real estate is much more comfortable to the lower and middle classes of the society because they have grown up listening about “having your own home” kind of things. A real estate is a comfortable option for them, as compared to the stock market.
- There is more safety of your money in case of real estate as you can physically inspect your property.
- Also, the value of your real estate property always keeps on increasing unlike the stock market, which can go up and down within seconds.
- In case of the stock market, you do not have to do any work, except for choosing the correct company whose shares you want to buy. In the case of real estate, there is a lot of hands-on work which you need to do. Taking care of your property and putting efforts for maintaining it are some.
- Real estate forces you to pay money every month if the property is not occupied.
So basically, the idea of investing in stock market or real estate is completely up to you and your preferences. Choose wisely and earn profit!