Quote:
Originally Posted by strobi
That is because they do not understand real estate at all. There is no way on earth an average joe can beat investing in real estate, by investing in stocks. Comparing 8% or so rise in prices to 10.5% rise in stock prices is like comparing apples with oranges. Even an investor with half a braincell can spot the faulty comparison by miles.
If you factor in leverage, tax advantages, buying in the path of progress/location the picture becomes entirely different.
From their article "The results? Housing delivered a solid but unimpressive annualized return of 8.6%"
Don't make me laugh. A well laid out project, over the course of 10 years, with good mangement will outperform stocks by a largeeeee margin.
The only way to score big with stocks is when youre on the inside, IE, when you issue your own stocks from your own company, or if you have a very profound knowledge of doing business.
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What do you consider a "project"? Buying some property and renting it out? Running something like that takes considerable amount of time, it's more of a business than an investment, you might as well stretch things even further and say buying McDonalds restaurants is an even better investment.
One important detail, everyone ommits from the stocks vs RE analysis, is that RE takes 10x more time to research/manage/buy/etc... so you are completely right it's like comparing apples with oranges.