Real Estate Investing Vs Stocks - Which Is Right For You?

So you've decided to become an investor but you're not sure whether real estate or stocks are better? Both property investment and stocks have their advantages and disadvantages, and there's no clear-cut, universal answer to this question. Whether you choose real estate or stocks should depend on the general economic climate, your experience and your personality. In this current economic climate, stocks are regarded by many as too volatile, and as there are some great deals to be had in real estate, property investment is more popular.

1. Reasons to Invest in Real Estate

  • Real estate is seen by many as a safer investment, and as something more tangible, as you actually own a property.
  • There are a wide range of options when it comes to choosing the best property investment; from commercial real estate investment to residential developments.
  • Leverage (debt) can be structured more safely with property investments than with bonds.
  • The recent economic crisis has created a number of unique property investment opportunities in the area of foreclosed properties. Investing in foreclosure properties will mean that you are most probably paying less and that your investment is less risky.
  • Real estate investments can give you a regular monthly income. 
  • You can choose from a number of investment strategies when it comes to property investment, ranging from investing in a rental property on a long term basis to quick resale.

2. Real Estate Investment Cons

  • A real estate investment is usually illiquid This means that once you've invested in the property, you cannot sell right away. Many property investments are profitable only on a long term basis, and thus are not the most suitable choice for some investors.
  • Although the real estate market is not as volatile as stock markets, house prices can still fluctuate. 
  • If you do not manage to find tenants for your rental property or a buyer once you want to sell your property, a real estate investment can cost you money every month.

3. Stock Investment Pros

  • Buying stocks, reinvesting, and selling them has been a great wealth creator for many years. Experienced investors can make very good profits.
  • Your partial ownership of different businesses through stocks does not require any work, and you'll still benefit from the company's profits.
  • Good quality stocks increase their profits and dividends every year.
  • Stocks have more liquidity, which means that it's possible to sell any of your stocks, and buy new ones in a few seconds. 
  • You can easily diversify your investment portfolio when you own stocks. You'll need significantly more money to diversify in real estate.

4. Stock Investment Cons

  • While patient and experienced investors can make significant profits from stock market investing, due to the stocks' liquidity there are many psychological factors involved. Those not experienced enough might end up buying or selling at the worst times for emotional reasons.
  • Stocks are extremely volatile, and can show huge fluctuations
  • Stocks are less easily controlled by new investors. Their performance depends on economic circumstances outside of the investor's influence, and a seemingly good strategy might turn into the worst investment in a matter of minutes.


Overall, real estate investment and stocks both have their advantages and disadvantages. Depending on your personality, experience and willingness to take risks, you should be able to decide which option is better for you. Real estate is a good decision if you want to take advantage of the unique foreclosure market, plan on a longer term investment, and want to have more control over your investment strategy. Stocks have recently become increasingly volatile, but are suitable for those who are willing to take risks.

Interested in BMV (below market value) property investment? Belgrave Group has a wide range of available Atlanta property and Detroit property investment opportunities in the USA.

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