Which Is better: Investing In Stocks Or Real Estate?
The vision is still unclear in the world of investment in general, and the conflict between investing in stocks or real estate still exists, and is there an upcoming economic crisis that we may escape from, or will it have negative effects on the investment world as it happened in the past, and if the situation remains as it is? Now, which is better, safer and more profitable to invest in real estate or stocks?
The market strategy has changed over the years and years. The global political and economic conditions have become the main driver and guide for them. This does not mean that they were not like that before, but rather due to the large number of events and their strength and succession in succession, this greatly affected the various sectors, and made them easy prey to those conditions. and variables that occur locally and globally. So which is better to invest in the real estate market or in stocks, and what are the pros and cons of each investment separately.
Investing in real estate
When an investor or real estate buyer wants to buy a property of his own, whether to live or invest, he should have a good amount of money to pay once as a down payment for his property, which usually ranges from 20% to 25%, and then pays the rest of the amount in cash or finances it through the bank for a maximum period 25 years from the date of purchase. After that, he needs at least 10 years from the date of receiving the property to recover his capital, provided that the return on investment is not less than 10%.
Pros and cons of investing in real estate
The most important advantages of investing in the real estate market are that its risks are much lower than investing in other markets, and its assets are tangible and easy to understand and do. It also enjoys a stable and stable income over the months and years, and its value grows and its price increases over time.
As for its downsides, it lies in the need to carry out periodic maintenance, which has an annual depreciation rate of about 3% of its value, the risk of collecting money from the tenants, the delay in receiving the property delays the period in which the investor will start to recover his money, the current inflation in land prices has led to raising the prices and risks of this investment. In addition to requiring a large capital, it may be limited to the middle group financially and above and to the age group, most of which belong to over 30 years old.
Investing in stocks
Investing in stocks is the most useful in certain periods of time, but it is not safe. This type of investment and trading may have high and quick profits without little effort, but at the same time the investor has to predict any losses that may occur at any time and time.
Some internationally known international companies may enjoy huge profits and the share price increases over time with the increase in the number of investors in them, but the safety factor is very weak with regard to this type of investment.
Pros and cons of investing in stocks
The most important advantages of investing in stocks is a higher potential for capital growth than investing in real estate, ease of monetization and obtaining money in cash, there are no periodic maintenance costs or others, only this investment includes portfolio and fund fees and the cost of trading.
In addition to being an investment that is open to everyone, whether they are from the low-income group or the middle class or less, and for more broad and comprehensive age groups starting from the age of majority and possibly less, any secondary school students.
As for its negatives, it lies in its risks that outweigh the risks of investing in real estate, non-in-kind financial assets, usually unstable income, and there is the possibility of increasing or decreasing it according to the financial performance of the company or sector, so the investor must have the right knowledge, experience and information to make the right investment decision at the time the correct.
The conclusion states that forecasting stock or real estate prices is not easy, but with low cost and interest financing programs that may make investing in the real estate development sector more fortunate in this equation, in addition to looking at stocks with relatively stable returns that trade at very fair and reasonable prices Or, the middle solution may be investing in the shares of companies in the real estate market, and thus we have combined investing in stocks and real estate at the same time.
