Investing in Real Estate vs. Stocks

To invest in real estate or in the stock market: that is the question. Investing is perhaps the greatest way to truly grow your financial portfolio. But which between property and stocks, which route should you take?

RealtyHive is here to explore both investment options. Answer the following questions to narrow your focus!

Would you rather play it safe or take some risks?

A game of cards can tell you a lot about yourself. When betting, are you more likely to put it all on the line, confident that others’ circumstances will work in your favor? Or are you more likely to hold back and bet conservatively, even if you have a great hand?

Honor whatever your comfort level is with risk-taking and investing to some degree. Especially for first-time investors, this might not be the time to go all the way in — but it’s not the time to hold everything back, either.

For some, starting out small in the stocks can feel safer because they control how much (or how little they put in). For others, investing in real estate can feel safer because it’s an asset that they can tangibly see. If you’re more comfortable putting in a lot of money off the bat, a real estate investment might be best for you.

How much time do you want to spend on your investment?

Very little? Investing in the stocks is likely your best bet, especially if you’re starting out. Whether you hire a financial advisor or simply put money in the market and monitor it, investing in stocks will take considerably less time than in real estate.

Want to make this investment a side hustle, a passion project, or a full-blown career? Real estate investing is the way to go. Flipping or renting out houses takes a lot of time. While you could eventually get to a point of hiring a team of property managers, it will take awhile to get there.

What’s your timeline — how quickly do you want to see results?

This is a bit tricky to answer because seeing a return on your investments will undoubtedly take time. However, you have more control of when you want to pull out of the stocks than real estate investing. By that, we mean you could theoretically make a profit in a single day for your stocks and decide to sell (though most financial planners wouldn’t recommend this).

It will take longer to make money in real estate. Even if you’re into flipping houses, this takes longer than profiting from day trading. Most houses take years to gain value. If you’re impatient, investing in stocks might be the better solution for you.

What can you make better guesses on?

Have you done a lot of research and feel more comfortable starting out in the stocks? Are you living in an area that’s about to become the next trendiest city to live? It’s truly up to you to know which investment will have the best chances of panning out — though as always, there’s no guarantee.

What’s your end goal?

When do you want to retire? What’s the number in your bank account that you’re trying to hit? Where are you trying to travel to? What lifestyle are you trying to live? 

Figuring out your goals is a crucial piece to investing. If you love the idea of making small gains (and losses) over time, stocks are your best bet. If you’re looking forward to retiring with a hefty chunk of change from selling a property that has appreciated wonderfully in value, real estate is for you.

In the event that all goes well, you can make a heftier chunk of change from selling real estate later on than you can from stocks. But that comes with a hefty amount of work. Once you have some goals in mind, you’ll be more able to determine the best course of action.

We know that stocks and real estate investing are no small topics. As always, RealtyHive is driven to help people achieve their goals. Look through our listings today to find your next (or first!) investment property!