Property Investment Vs the Sharemarket

Who of you investors out there are still getting over the recent sharemarket waverings? Do you also have money invested in real estate? I bet your sharemarket investments have been giving you a lot more worry over the past week than your property investments.

While the fate of your stocks has been “thrown to the wind” at the whim of the Asian sharemarkets, your property investments have just been casually accumulating further capital gain. You haven’t had to sit outside some glass window watching numbers dictate your future because you knew that the likelihood of your bricks-and-mortar investments collapsing were pretty remote. Doesn’t it make you wonder why people invest in the sharemarket at all?

The sharemarket can be an exciting place to invest. The gains are much easier to see because you can look up the closing prices every day in your local paper. But are you investing to get the thrills of the market game or are you investing to make real money? It seems to me the serious investors, those who really want to increase their wealth and not take serious risks, choose the property market to invest. They know that the capital growth of their property investments is opening up new opportunities for further investments and that their portfolios are safe from the fickleness of the sharemarket.

But perhaps, the greatest attribute of your investment property portfolio is the high income yield you can expect through good times and bad. This income yield, after all costs, should average above *8%p.a., plus any capital gains over time.