Hi there,
It's a very tough question to answer, but let's see whether we can put it in perspective.
Differences between Equity and Property
1. Equity is more liquid, as at any point you can cash out your capital. t + 3 and it's back in your account. If you buy a new condo, you cannot cash out until 5 years later. Due to ABSD.
Equity investments has been able to provide more gains to property in the past 10 years. If you had invested 500k in the S&P 500, you would have a net gain of 200%.
Equity can provide your portfolio with positive returns, via dividends. Property might not be able to generate returns, as rentals might not be able to cover your mortgage + Monthly maintenance.
At the end of the day, you will need to do the math to see whether it works for you. To buy a decent development with potential, would cost a minimum of 1.5m, with a downpayment of 375k. Factoring in the mortgage repayments over 5 years, your annualised returns might be around 4%, if you are able to sell at 20% of purchase price. There might be some opportunity cost, but property is always tangible at the end of the day.
Hope I was able to shed some insight!
Hi there,
It's a very tough question to answer, but let's see whether we can put it in perspective.
Differences between Equity and Property
1. Equity is more liquid, as at any point you can cash out your capital. t + 3 and it's back in your account. If you buy a new condo, you cannot cash out until 5 years later. Due to ABSD.
Equity investments has been able to provide more gains to property in the past 10 years. If you had invested 500k in the S&P 500, you would have a net gain of 200%.
Equity can provide your portfolio with positive returns, via dividends. Property might not be able to generate returns, as rentals might not be able to cover your mortgage + Monthly maintenance.
At the end of the day, you will need to do the math to see whether it works for you. To buy a decent development with potential, would cost a minimum of 1.5m, with a downpayment of 375k. Factoring in the mortgage repayments over 5 years, your annualised returns might be around 4%, if you are able to sell at 20% of purchase price. There might be some opportunity cost, but property is always tangible at the end of the day.
Hope I was able to shed some insight!