The stock market is better than real estate. Investing in the stock market is
a better investment than investing in real estate,
that being said investing in real estate is probably easier than investing in the
stock market because it's less volatile. David Jaffee with BestStockStrategy.com
and in this video you're going to learn why investing in the stock market
is better than investing in real estate. There are primarily two main reasons: the
first is liquidity. If I own a stock and I want to sell it I can sell it within a
fraction of a second with a touch of a button. If you own a home you are unable
to flip and to turn that house into cash very easily. At a minimum I would think
it would take you 2 to 3 months realistically it's probably going to
take you 6 to 12 months and this piggy backs on to the second aspect and the
reason why the stock market is much better than real estate the transaction
costs involved in real estate are substantially higher then they are in
the stock market in real estate you have to go to the bank you need a mortgage
you have to pay a broker you have to pay for maintenance there's risk as far as
like the weather or things like that I mean there's risk in the stock market as
well so take that out but the transaction fees are substantially
higher when you deal with real estate you pay a broker they get commission the
roofer (repairs and maintenance) gets commission, the contractor gets commission the agent gets
commission, everyone gets commission you are the last person to get paid and if
you actually look into it, if you buy a house you're
essentially going to have to sell that house for probably 20% 25% more than you
bought it just to break even on that transaction when you factor in the
capital gains taxes, the property taxes, the closing costs the broker fees and
all of the other things so I know that people like Grant Cardone and Meet Kevin
are telling you that owning real estate is one of the best investments that you
can make and look I'm a big fan of Grant Cardone I love his work ethic the guy's
almost 60 years old and he's killing it so I have a ton of respect for him but
the fact remains that there is virtually no situation where owning real estate is
better than trading or being involved in the stock market. So if you have $100,000
and you want to make a decision between the stock market and owning real estate
you should always choose the stock market plus I think that the stock
market returns on average are probably 2 to 3 times what the real estate
appreciation is and what you would get if you actually owned a home now yes I
understand that there's increased variability and volatility but if you
just bought an ETF and then you bought you know the SPY and then you just parked
your money in there and you let it sit and you let it sit for over a year so
therefore you have you have long-term capital gains and you're only paying 15%
on that you would pretty much double or triple the gains that you would get in
real estate now I understand that with real estate you have the ability to use
extensive leverage you can buy one house you can then rent it out you can use
that cash flow to put the downpayment on a second unit and then rent that out you
can keep doing that but not everyone who does that are successful actually very
few people who do that are successful so the point is that for the average person
you are way better off investing in stock market than you are in real estate
and like I said for numerous reasons the first is the amazing liquidity in the
stock market you could just press a button there's no risk of having bad
tenants or having people rip you off or having a bad contractor or a bad leasing
agent or a bad realtor any like anything like that you have to deal with any of
that stuff and the second thing is is like the second thing is the transaction
costs are saving a tremendous amount of money where you're instead of paying
like 15 20 percent of the total transaction cost instead when you deal
in the stock market you're dealing for basically I would say 1/10
of 1% would be your transaction costs so that's pretty much it for the average
person you should definitely skip owning a home and you should also skip going to
college and you should not listen to people like Grant Cardone and Meet Kevin or MeetKevin
who tell you that you should buy a house I just think it's completely wrong but
that's my opinion you're welcome to disagree I know that my opinion on this
is probably not going to be very popular but real estate is definitely inferior
to investing in the stock market. This is David Jaffee from BestStockStrategy.com
I teach people how to make money in the stock market by trading stock
options you can go to best stock strategy comm and enter in your email
address and receive over $400 worth of free training materials if you have any
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video and I appreciate your attention I am here to be of service to you and
thank you so much