Reasons to put your money into real estate instead of stocks:
Structuring of Debt
The structuring of debt in real estate is easier and safer than in stock market investment. In the stock market, the structuring of leverage is much complicated, thereby making the acquisition of stocks using debt margin very advantageous and risky. Debt is a tool we will learn how to use it correctly (simplepassivecashflow.com/debt).
Investing in a Hard Asset
Real estate investment brings in the tangibility of investment, thereby making it a much secure investment compared to the stock market. Tangibility makes it hard for one to be defrauded. One can physically show up to make sure that the house is there before acquiring it.
Barrier to Entry
There is a barrier to entry. Unless you have $30,000 you cannot get into the game to buy a $100,000 house. We like barriers to entry... that is what thins the competition of the Gen Z or Millennial who (has no life) is trading with their app penny stocks or the next crypto coin.
Cash Flow
And of course the Cashflow from monthly rents exceeding expenses and tax benefits which we will dig into in a later lesson.
Tax Benefits
One of the best reasons to invest in real estate is the tax benefits. This is important especially if you are a high-paid professional.
Investing in real estate can have the following cons:
Extra Effort
Real estate is not as easy as stocks where you can just click a button to buy it. An investment in real estate comes with a lot of hands-on work attached to it. Tasks such as oversight, maintenance among others make a real estate investment undesirable compared to the stock market investment, which comes with much less attached to it. This is why Simple Passive Cashflow is here to simply the world of passive investing for the high net worth busy professional!
People Based
Real estate is a people based industry, if you try to lone wolf it, you will likely lose a lot of money on the way. It helps to have a mentor or peer group point you in the right direction.
