If you were given the chance to invest your hard-earned money, would you go for the stock market or the real estate market? If you pick the latter, you’re making a popular choice. A new study by the Federal Reserve Bank of New York showed that an overwhelming 90 percent of Americans prefer investing in their own homes rather than in the more volatile stock market.
Below are a few reasons why real estate is a better investment than stocks. If you’ve been thinking about investing in the Longmont real estate market, these should make the decision easier for you.
Stability and comfort
The said study also found that most Americans prefer the stability that real estate investments offer. Though stocks may provide better returns, the stock market tends to be more volatile and unpredictable. House prices, on the other hand, only go up or down depending on the demand for properties in a specific area.
Easy to understand
Entering the stock market means familiarizing yourself with its terms and intricacies. Even with this knowledge, earning significant returns isn’t entirely guaranteed. On the other hand, investing in the real estate market is fairly straightforward. You simply need to search for and purchase a property, manage it by handling its upkeep and offering it to renters, and ideally resell it for a higher price. It does involve a lot of work on your part, but at least you won’t have to worry about all the complexities that the stock market has.
Invest with loans
Those familiar with the real estate market know that buying a property means getting a mortgage, which is basically a loan that you need to purchase a house. Nowadays, getting a mortgage is simple enough, even for first-time buyers, and you can invest in a property with only a 20 percent down payment.
Getting a loan for your stocks, however, is entirely different: this is known as margin trading, and it’s something that carries a lot of risks, even for those who have been in the market for years. Unless you’re an experienced trader, you wouldn’t want to risk acquiring debt for stocks.
Enjoy tax advantages
Stocks don’t often come with the tax advantages that real estate properties provide. Apart from a tax reduction for mortgage interest, you can also be qualified for tax breaks if you decide to sell your residence. There are also a number of tax breaks that you can enjoy, such as writing off wear and tear in your property.
A tangible investment
There’s a certain sense of accomplishment in seeing your investment flourish and thrive, especially if you can actually see it right before your very eyes. Sure, you can see the movement of your stock investments virtually, but at the end of the day, stocks are merely numbers on the screen. Nothing beats the satisfaction of having an actual property that you can show off and proudly call your own.
Ready to invest in real estate? When looking through available homes for sale in Longmont, CO, make sure to work with professionals from the Noel & Martinez Team. We know the ups and downs of the real estate market, and we can help you make the right investment that will yield significant returns.
