Most investors have money in the stock market, tied up in conventional investments like stocks and mutual funds, but many have no idea that investing in real estate could actually provide much better returns over time. Most people realize that the stock market isn’t secure, but they feel like it’s the only way to save for retirement and typical investment advisors won’t clue them in to any alternative investments – like buying real estate – because these things don’t pay an easy commission.
Investing in Real Estate vs. Stocks
For many investors, the stock market just isn’t performing well enough to build wealth and ensure a secure retirement, which leaves them considering alternative investments as a path to financial security. To help, we’ve put together 5 reasons real estate investing is better than buying stocks:
1. Cash Flow
Even the highest dividend paying stocks seem to pay around only 4 percent, which barely even outpaces inflation… And that’s if you’re lucky! With real estate, it’s possible to get 8-14% returns with turnkey vacation home rentals in top destinations like Playa del Carmen in Mexico’s Riviera Maya – unlike stocks, which you have to sell in order to realize the gains – guaranteed rental income and other returns from real estate investments are realized immediately and the property can still appreciate on top of it.
2. Easy Valuation
Compared to other investments, real estate is much easier to value, even if you have no idea how to do it, thanks to appraisals. Also, you can always simply schedule a real estate consultation with one of the top real estate investment companies who are familiar with the area where you are looking to buy property and they will be happy to do a price comparison for you. With stocks and other investments, the value is much more difficult to determine and can also change from one day to the next. This is just one reason real estate can also be a much more secure investment than the stock market – provided you buy smart and within your budget in a desirable location.
Similarly, real estate is superior to stocks and other investments because you can obtain a third-party inspection of the property in addition to real estate consultations, price comparisons and a professional appraisal. Buying real estate that has been professionally inspected will provide added peace of mind and help you thoroughly evaluate the investment property. On the flip side, just imagine how a corporation would react if you asked them to run an independent inspection on the company – by an inspector of your choosing – before buying their stock!
4. Buying Below Market Value
You can also buy real estate below market value by taking advantage of presale pricing on new developments, like vacation home rentals in Mexico’s Riviera Maya, a popular tourist destination that gets 80-90% occupancy rates in one of the world’s best vacation rental markets. Some developers offer presale pricing at a substantial discount while the property is still under construction, which means that buyers can immediately realize a profit when the finished homes are delivered and the prices go up to reflect the real market value.
5. Adding Value
You can almost always add even more value to a property after purchasing it by performing luxury upgrades or repairs. This simple fact gives buyers even more control over their real estate investments – again, especially compared to stocks and mutual funds, where it is totally impossible for an investor to add value.
Advantages to Buying a Vacation Rental Property
Of course, there are many more advantages to real estate investing compared to buying stocks and mutual funds, including tax advantages, equity and – with turnkey vacation home rentals in popular tourist hubs – buyers also get to enjoy ownership of a luxury condo or villa that pays for itself and produces a steady stream of ongoing income… What could be better than that?
Do you have any tips for buying a rental property? Or do you have questions? Leave your comments below to discuss!
Ready to learn more? Click the following link to see why Playa del Carmen real estate is ideal for vacation home rentals and start your journey to financial freedom today!