"Why invest in real estate when stocks are better?"

[Hazel L]

I can't say how many times people have told me this once I tell them I work in real estate. I've done my research and I think I have a pretty good comeback especially when they throw articles from CNN like this at me:

http://money.cnn.com/galleries/2007/real_estate/0704/gallery.stocks_v_realestate.moneymag/index.html

Just wanted to see if anyone had a good answer they wanted to share! :D

[Will Barnard]

If someone actually referenced that specific article, my comeback would be the fact that that article ONLY considered market appreciation levels in RE and not all the other factors that could contribute to a higher return.

For instance, in addition to market appreciation, you have forced appreciation, tax advantages, leverage advantages, and the fact that you can buy RE at a discount at acquisition and you can not with stocks. The price you pay for a stock is 100% retail market price that day whereas, in RE, I can buy something that is currently valuated at $100k in it's existing condition and only pay $60k for it. I just got a 40% return on day one - how much did the stock buyer gain that same day?

Lastly, buy and hold is not the only way to make money investing in RE. You can flip as I do and make 100% annual returns very easily if you know how. Show me any stock broker that can consistantly do that year in and year out.