Is Real Estate Still the “Best Investment?”

Since the collapse of the housing market in 2008 there has been a debate among the
investor class about which is better. Real Estate or Stocks and Bonds. Like most things in life there is not a simple answer to this question. However a portfolio with a substantial level of real estate is still best for the strategy.

This bullet points below provide a summary of the advantages of each strategy. For us the deciding factor is simple. “Most Successful investors” strive to keep real estate investment levels between 45-65% of their total portfolio. Those high percentages indicate where the intrinsic value for most investors should be.

This percentage will be even higher if the carried interest deduction is eliminated as is being proposed by the top Presidential candidates.

For the average American “the right property at the right price” is the most important factor to a successful real estate investment.

Real Estate vs. Stocks

• You are more in control
• Leverage with other people’s money
• Tax advantageous
• Tangible Asset
• Easier to analyze and quantify
• Less visible volatility
• A source of pride
• More insulated from economic
  downturns
  
• The government is on your side
  

Stocks vs. Real Estate

• Higher rate of return
• Much more liquid
• Lower transaction costs
• Less work (maintenance)
• More Variety
• Invest in what you use
• Tax benefits
  
• Hedging is easier
  

.Get the full article with details on the advantages of each strategy here.