Our stock market has been hitting some all-time highs lately. This raises a question: Should you be investing in the stock market or should you be investing in real estate?
When you buy a stock, you own a piece of a company. There are a number of things that can happen with this kind of investment. Both real estate and stocks can go down in value, but there are a few key differences.
For example, while the real estate market may go down in value, you can still always have a property that you rent out to a tenant and gain income from. When investing in real estate, you can also make money on appreciation.
The decision as to whether you should invest in real estate really depends on your long-term motives. Do you want to own a property that can pay you an income stream every month during retirement? Do you want an income stream that you can increase year over year based on inflation?
If you feel apprehensive about investing in real estate, consider this: Are rental rates higher than they were in the 1970s, 1980s, 2000s, and even in 2010? Of course they are. While rental rates can tick down based on the real estate market, they’ve never gone as low as they were decades ago.
Owning a rental property that has been completely paid off can bring you great financial security through retirement. This is a strategy that has worked amazingly for some clients of mine.
If you have any other questions or would like more information, feel free to give me a call or send me an email. I look forward to hearing from you soon.