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« Job Growth Good | Main | Detroit Hurting--Legacy Costs Not the Problem »

April 10, 2007


Ruben A

In the returns you projected, did you actually take into account the fact that most real estate is purchased with leverage? You can't leverage stocks the way you can real estate. Will the bank lend you 80% of the value of a stock so you can purchase it as an investment? And there is a much greater ability to control real estate than there is with stock. If a stock doesn't perform, you can sell it, or buy more of other stuff to diversify. But you certainly can't change the way the company does business in the stock you own. All the contrary with real estate.

Also, your article only addresses one type of ownership in real estate, and that is the type used as a residence. If you are to compare real estate with stocks as an investment, you can't simply eliminate investment properties into your equation. You can own and control real estate investments, but renters pay your bills for it.

Regardless whether a person goes real estate or stocks, they will always need to do the leg work in order for them to make a return, otherwise, the only ones making the money will be the stock and real estate brokers.

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