- Posted on March 6th, 2014
Real Estate Investing vs Stock Market
I hear from people interested in investing in real estate all the time. They have some disposable cash that they want to invest and the most frequent question they ask is, “What do you think of real estate investing vs stock market?”
Comparing Real Estate Investing vs Stock Market
Let me begin by stating that real estate investments are better compared to bonds rather than stocks.
Why?
In most instances the value of real estate cannot go down to zero since you have the intrinsic value of land and whatever structure sits on top of it. With stocks, everyone knows that there is always the risk that a company goes out of business. We can call that minimum value of real estate the face value of this bond.
Most real estate properties, even more so here in Miami, have the ability to generate income through rent or, if you live in it, as a housing service (it is better than spending a long time in a hotel). This is what I would call the coupon for this bond.
It’s All About Timing
Timing is the most important element that will vastly improve your return. Everyone knows the value of buying low and selling high in the stock market.
When it comes to real estate investing, timing can be even more critical.
Generating the Better Yields
If we treat real estate investments as bonds, we need to determine which ones will generate the better yields.
That can vary depending on:
- the current market conditions
- the type of real estate property
- how involved you want to be in managing the property
This is where we can help you make the right choice. Interested in purchasing luxury Miami real estate? Contact us today to find out where you can take advantage of the Miami real estate market.
One final note. We are not selling investment vehicles but real estate. Nevertheless, everything in life is an investment and we understand it.
To work with Andres, your experienced luxury realtor, and Constec Realty Services, an established real estate agency that specializes in luxury Miami real estate, contact us now.
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