blog

Property vs Shares: What’s the Difference & Which Is Better For You

property investment vs shares

Prophero

Love it? Share It!

property investment vs shares

Property vs Shares: What’s the Difference & Which Is Better For You

There are so many options when it comes to investing your money to grow wealth, and it can be really overwhelming and stressful choosing the right investment path for your unique situation.

Let it be known though, that everyone’s personal situation is different and you’ll need to choose the right option based on your specific circumstances. 

When it comes to investing in property or shares there are distinct differences so we’ve created this post to help demystify the difference for you and help you choose the right path. 

 

The benefit of investing in property

Investing in property is a big decision. It can take time, there are costs to investing in property, but the reason millions of Australians choose to invest in property is because the overall return is higher, there is less risk compared to shares and you also get the experience of owning something tangible that could be passed on or sold later down the line. 

Unlike shares, investing in property gives you immediate access to cash flows. The average return for investing in the stock market can take up to 10 years. 

If you want to learn about the pitfalls of investing in property, you can download our 10 minute webinar here. This will give you tips and tricks on the areas and locations to avoid if you’re concerned about investing in property. 

 

The benefit of investing in shares

The stock market is known to be more liquid than investing in tangible properties. The higher the liquidity means the faster you’ll have access to cash.

The stock market brings togethers millions of investors into one economy, which reduces the cost of every transaction significantly. 

Given the cost to entry of investing in stocks is very low, you can also spread your risk across multiple investments easily. 

 

The benefit of property over shares

Though you may prefer the fast paced, almost betting nature of investing in stocks, the PropHero team firmly believes there are significant advantages of property investments over shares. Check them out below: 

Investing in property is a popular choice with Australians

Property is rooted in Australian culture and Australia property is so appealing in fact that we even attract a number of international investors to our scenic shores. There are a lot of pragmatic reasons why Australian properties are so sought after: we have a high quality of life, there is lower crime compared to other countries, and we have beautiful tourist locations that are always in need of tenants. 

Leverage: You can borrow funds to amplify your return

The bank will finance 80 or 80% of your investment which means if you invest wisely you can multiply the return on the money you invested by 5 or 10. This isn’t the case with the stock market. The bank is not going to lend you 80% of the money to invest in the stock market. 

Cash flows

If you invest wisely you can get significant cash flows every month. And if you invest in the right areas, this can grow very quickly. There are not many other types of investment that can deliver cash flows that grow each month.

The stock market is more volatile

The stock markets are volatile. They go up and down all the time. In property, despite the changes and booms, they are more stable over time and you won’t be at risk of losing your investment the same way you could with the stock market. 

 

If you want to learn more about investing in property, you can book a free 30 minute strategy session with our team right here

Scroll to Top