can only apply it to one property.
Allows for Control over the Asset
Real estate is typically an investment an individual has control over (assuming you’re the majority owner – which is typically the case) by the means of the owner has the ability to increase the value of the asset, which may not be the case in most other investment opportunities. When purchasing real estate, owners can make capital improvements to the home (ex. Finished basement, new porch, etc.), which will increase the value of the property (capital appreciation) as compared to purchasing stocks or mutual funds as assets where the owner can’t take action to increase the value of those assets (unless they’re a significant owner, greater than 20% – which is typically unlikely). The ability to control an asset adds value to the owner through what is known as a control premium, as a real estate asset may be more valuable in the hands of some individuals over others.
Why a House is a Bad Investment
Lack of Diversification
Average individual thinks the stock market is very risky while investing in real estate is more of a
 |
The Neatest Little Guide to Stock Market Investing, 2010 EditionRead Jason Kelly’s posts on the Penguin Blog The essential stock market guide updated with timely strategies for investing after the crash Now in its fourth edition, Jason Kelly’s The Neatest Little Guide to Stock… Price: 16.00 |
 |
The Little Book of Common Sense Investing: The Only Way to Guarantee Your Fair Share of Stock Market Returns (Little Books. Big Profits)Investing is all about common sense. Owning a diversified portfolio of stocks and holding it for the long term is a winner’s game. Trying to beat the stock market is theoretically a zero-sum game (for every winner, there must be… Price: 22.95 |
