Investors often eye the basic options to put in their money. Years back the investments were high in the stock markets but with time, people have started preferring the options of real estate investments as well. No matter if it is an apartment
or a luxury villa
, investments have risen over the years in this sector. Irrespective of what the preferences are, people often are confused between these two investments options and if you too are dealing with the same problem, we bring you the best insights to help you so that you can take a better decision. A comparison is made based on some common factors as discussed below.
Investments involve some kind of risks and therefore both real estate sector and the stock market have their set of risks. In case of real estate sector, this risk is relatively low. Since the analysis is easy, you have an extra idea about the trends and a control over managing your profits and losses.
In case of stock market, you get a chance to see the previous charts, past performances and company reports as well but in spite of all this, a sudden fluctuation in the economy can damage the entire investment and take you to unmanageable losses.
2. Amount of investment
In share market, you can easily trade with small amount of money but when it comes to the real estate investments they are usually very high. No matter how small a property is, it would be a matter involving thousands but this is not the case in stock trading. You get the opportunity to put any amount, be it low or high.
3. Investment durations
People often overlook this aspect while making investments but be sure of the fact that you know for exactly what time duration you plan to invest your money. In case of real estate sector, most of the investors consider it as a long term investment while with various trading options available in the stock market, you do not have to worry about the time frames.
4. Return on investments
The return on investment is completely dependent upon the time you invest your for. Although you can make quick profits in the stock market, the returns that you get on real estate investments would anytime be high and well paying. For instance, if the market is struck with inflation, your property’s rates with go up in one go. Moreover, you own a property, you can anytime live in there or even rent it out in case of crisis.
5. Tax benefits
Although you will have to pay taxes in both the scenarios, you often get tax and loan benefits when you invest in properties. Although the tax implications are much less in case of stock investments, you can choose wisely and then decide accordingly.
Although both the sectors have their sets of positives and negatives, prefer investing in the property if you have that kind of budget as it is safer, less volatile and yearns better results over the time.