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The stock market and real estate investing are two great ways to invest your money. Each strategy comes with its own advantages and disadvantages. Both of these strategies can also be fantastic for making extra income.

So, let us look at what they are. Stocks are simply shares of a company. When you buy a stock you are investing into the growth of the company and if the company offers stocks that pay dividends they can even be a nice source of passive income.

There are a few advantages of investing into the stock market over real estate investing.

1. Appreciation

The stock market has historically appreciated faster than any other asset class. If you buy a $100,000 house and put $100,000 into the stock market chances are in 20 years you will have a lot more money in the stock market then the value of that house.

2. Passive

Stocks are also a passive strategy. You don’t have to worry about fixing repairs or about tenets who don’t pay. All you have to do is to buy the stock and then hold onto it.

Now beginning to invest into real estate, can be very powerful. It involves buying a house and then renting it out. This strategy does have its advantages over stocks.

1. Leverage

The biggest advantage of real estate is the leverage. While over the long term stocks have appreciated faster then houses, you can buy a lot more with less in real estate. If you are only putting 10% down then you can buy 100,000 worth of real estate where you would otherwise be able to only buy $10,000 worth of stock. This makes a big difference.

2. Physical

Another advantage of real estate investing is that it is a physical object that you can touch. While stocks are normally traded online and all the information is saved on a computer, real estate is actually something that you can visit which is a big deal for most people.

Both of these strategies can make you very wealthy over the long term. It is just a matter of finding out which strategy works best for you and sticking to it.


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Filed under: Buying Real Estate • Foreclosure Auctions • Real Estate Foreclosures • Real Estate FSBO • Real Estate Investing • Real Estate Law • Real Estate Marketing • Selling Real Estate

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