Real estate is one of the most preferred investment choices among investors. Real estate asset offers a number of benefits. However, stocks are a familiar investment option as well. Nevertheless, with any asset class, there are advantages and disadvantages. Yet, real estate continues to be one of the most preferred investment options whether you are an amateur or someone seasoned.
This blog intends to elucidate real estate or stock market which is a better investment option.
Real Estate Asset vs Stock Market: Benefits
- Safer Investment
- Tax Benefit
- Hedge against Inflation
- Own at Lower Cost
Well, we cannot refute that with all advantages, there are cons as well. Even though real estate offers considerable asset benefits, there are some factors to think about.
Real Estate Investment vs Stock Market: Drawbacks
Unquestionably, real estate an investment offers less liquidity compared to options like stocks, gold, etc. Most importantly, if you are in urgent need of cash, you can simply sell your stocks and get cash. On the other hand, with real estate this is not possible. You need to hang around for weeks or months to sell off your property.
The transaction costs related with real estate are notably higher than those with other investments say, stocks. The former include registration costs, legal costs, agent commissions (if any), taxes besides othe additional expenses.
The maintenance costs linked with real estate is also sky-scraping. As you pay for a property, subsequently, you need to spend a good amount of money in maintaining it in perfect condition. This is important to fetch a high value at the time of resale. You may also keep the property attractive to potential renters for years. Maintaining your building premises is necessary in order to preserve the asset as well.
To Sum up
Real estate is an option that can be lower risk, give in better returns, and put forward greater diversification. It is sensible to choose the one with much stronger return potential.
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