I'm a big fan of the bogleheads forum but I also read biggerpockets (real estate) often too. I personally favor equities because it allows greater convenience and mobility.
However, the real estate investing argument is pretty strong when it comes to cash on cash returns. I was wondering how the people on here decided to favor one investment over the other? I'm sure a lot of people here have primary residences but i'm talking more about investment real estate.
The pros and cons of real estate over equities that I can think of..
pros:
Potential higher returns due to leveraging and real estate appreciation
Investment backed by hard assets.
Natural inflation protection in most areas
Fairly easy to pass down to heirs
Good tax incentives for rental income and depreciation rules
cons:
Tenant hassles
Undiversified risk
Hard asset that is better managed locally
Vulnerable to disaster or accidents.
uncertain appreciation which may underperform inflation
However, the real estate investing argument is pretty strong when it comes to cash on cash returns. I was wondering how the people on here decided to favor one investment over the other? I'm sure a lot of people here have primary residences but i'm talking more about investment real estate.
The pros and cons of real estate over equities that I can think of..
pros:
Potential higher returns due to leveraging and real estate appreciation
Investment backed by hard assets.
Natural inflation protection in most areas
Fairly easy to pass down to heirs
Good tax incentives for rental income and depreciation rules
cons:
Tenant hassles
Undiversified risk
Hard asset that is better managed locally
Vulnerable to disaster or accidents.
uncertain appreciation which may underperform inflation