When most people think of investing, the first things that come to mind are the intangible, particularly stocks and bonds. While many people may not understand its more complex innerworkings, most have some idea about what investing in stocks entails. But what about bonds, and are bonds sound investments, especially when compared to more tangible investments like real estate? In this article, we will consider these questions carefully.
What is a bond?
To put it simply, a bond is a type of loan whereby an investor gives money to a company, an individual or the government. In exchange, these parties promise to pay back the loan by a specific date, along with regular interest.
On one hand, bonds are typically a lower-risk investment than other more common types, especially stocks. When you buy a bond, you understand the terms and conditions from the very start and so will not likely encounter any unpleasant surprises.
That said, because they are low-risk, bonds tend to be low-yield investments unless specified otherwise. While there is usually clear risk involved, real estate often yields higher returns while also building equity.
Real estate builds equity in many ways. This could be through debt decreasing or property value increasing. In contrast, the gains you reap from bonds will be predictable and consistent but generally unremarkable. Additionally, bond returns do not respond well to inflation.
Real estate, however, is by nature dynamic. It responds to the market, which means when prices go up, so does the value of your units. When you own several apartment buildings and demand for housing in your city is on the rise, you can expect to earn more from each of your units.
In sum, the higher yield, increased stability, and long-term benefits of investing in real estate prove better and more worth your investment than bonds.
How do I invest in real estate?
There are many ways to invest in real estate. While there are intangible options like real estate investment trusts, many find it rewarding to actually manage the properties for themselves by renting them out, overseeing their maintenance, and so on.
Investing in real estate can be done through investment in rental properties or flipping property you’ve invested in. Perhaps the best way to start into real estate investment is by renting out part of a home, even if it’s just part time through a platform like Airbnb.
For more guidance, reach out today. I want to hear from you!
Lea and Lefry Amarille are real estate investors. They have been actively involved in the GTA and Durham Regio for a number of years. Their mission is to provide great quality homes for tenants, while at the same time providing an above-average return on investment (R.O.I) for their investor partners and themselves. It is truly a win-win-win way of investing! Lea and Lefry offer their investor partners hands-free investment opportunities. If you are interested to learn how to earn an above-average return on your investment, backed by a solid asset, and without the hassle of being a landlord, please contact Lea and Lefry. For more information about Lea and Lefry and their investment program,
please call (416) 827-0586 or visit https://investorleaandlef.com/
