The main
advantages of shares (compared to property) include:
- You
can outsource the management of a share portfolio to an advisor. However,
as a property investor, you may need to spend time working with your
managing agent to deal with tenant issues and/or property
maintenance/repairs.
- Shares
can generate a stable level of income with no (or few) related expenses.
For example, the ASX200 index has yielded circa 4.5% p.a. for a long time.
- Shares
are liquid and have low entry and exit costs e.g., no stamp duty, real
estate agent fees, etc. This means you can invest and divest in small
increments.
The main
advantages of property include:
- Most
investors feel comfortable borrowing to invest in property, which means
you don’t need to make a large upfront cash contribution to be able to
invest.
- The
assets' tangibility can make investors feel more comfortable.
- You
don’t need ongoing financial advice after you have purchased the property.
- The
investment-grade property provides most of its return in capital growth in
return for less income, which is tax effective.
We can
debate the pros and cons of shares and property until we are blue in the face,
but I think it’s a meaningless debate.
It’s like
debating which golf club is better.
They are
all different and you need more than one club to play well.
RealRenta has all
the tools that a property manager has but for less than ¼ the cost of a
property manager.
You can now manage your Residential, Commercial or
share/student accommodation property
Join now and the
cost is less than a cup of coffee a week to manage your rental property.
RealRenta also has
a free vision, so why not check it out.
Jason Gwerder
Thursday, 29 February 2024