Also, you want to keep a tight timeline on when to exit. Exit strategy is at best one of your best option. Another thing is future net worth comparison that makes investment sense. An analogy is earning a net 1.5% ROI after taxes in equity investment (stock purchases) everyday for 300 days equals to 450% net profit gains. While search, discovery, research, analysis, team development, inspection, approval, permitting, pre-construction, planning and construction phase, local government bureaucracy, release, trust deed inspection, verification, sales period, closing period can take up to 300 days hoping for a net worth gain of up 20% and a 3% property appreciation may also be an option.
So, you can compare say $200,000 cash investment in
1. Stocks at net 1.5% daily ROI (execution time, 1 second to 2 hours a day) for 360 days.
$200,000 x 450% = $900,000
Net Gain = $700,000
2. Real Estate, property or properties. Buy Low, Sell High within 360 days with 20% net ROI and 3% appreciation
$200,000 x 20% = $40,000
$200,000 x 3% = $6,000
Total Net Gain = $46,000
Or, you may combine these and along a conservative approach in real estate investing, leverage properties for buy low sell high (rehabs, flipping for turnkey), then cash purchases for buy and hold properties for residual income. Then use leverage again for the same technique.
