Investment is good but choosing the right investment is better. As an investor choosing the right investment that yields high Return on Investment (RoI) will definitely skyrocket your net worth. In this write-up we will enlighten you on what is Real Estate investment and what is Stock and we will also show you the advantages and disadvantages of investing in any of the two.

Investing in real estate involves buying properties which includes; lands and building for personal use, rent and land banking. While investing in Stock involves buying share from a company and waiting for it to appreciate.

Investing in either of them or both is good but you need to know what is involved. There are lots of things to consider when deciding which to invest in Real Estate or Stocks.

REAL ESTATE

Real Estate can be residential properties which includes rental houses or flipping houses or commercial properties such as shops, warehouse, malls, office building etc.

Things you need to know about investing in Real Estate:

Real estate is easy to understand unlike the stock market. Real Estate investment is easy in that you can pay as low as 30% of the value of the land and then spread the balance payments. Real Estate investment can serve as a hedge against inflation. Instead of the value of land to crash during inflation it will appreciate.

BUT

Real Estate investment involves more work in the area of maintenance. Real Estate is highly expensive to compare to stock. Real Estate investment involves huge capital and on the point of reselling its another task getting a buyer to buy the property unlike the sock market that you just click on a button in the system and your stock is sold. It is difficult to diversify real estate investment because buying a property in a high brew area and getting another land in a remote area is huge investment that requires a lot of capital. The return on investment is not a sure thing because while the prices of a property may rise the owner is at risk of reselling at a loss.

Looking at investing in Real Estate? 

STOCK

The stock can be sold at any point in time and you can diversify your investment in stock. One can decide to buy shares from up to 10 companies. There is little or no transaction fee in stock unlike in real estate where you pay commission to agents, agreement fee etc.

BUT

The price of stock is so volatile, it can change at any given time. It moves in a speed of light unlike the real estate price that appreciates gradually. The price of stock can be high in the morning and in the afternoon it has crashed. The stock can trigger emotional decision taking. If you are not in full control of your health its advisable not to get involved in the Stock.

In conclusion, as an investor looking to invest in Stock or Real Estate it advisable you have a well guided and informed knowledge about the two investment options.

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