The stock market version of a bank loan is buying stocks on margin, which is so much riskier than taking out a home loan. It's riskier because the stock market's more volatile than the housing market. The lender can make what's alled a margin call, where you have to sell off your assets at a loss. So investing stock, investing on margin, is never something that i recommend. A sto strategy, and all stock strategy, ideally, in my world view, is a zero leverage strategy.
#373: How do people make money in real estate?
Many focus on rental income, but this is only one of five ways that properties create wealth.
We explain five surprising ways that real estate builds your balance sheet: cash flow, appreciation (market-based and forced), tax benefits, principal paydown, and instant equity at closing.
Why does this matter for long-distance investors?
If you’re investing out-of-state, you’ll need to choose a city or town. How do you decide? First, think about how you want to bias your returns. Do you want to optimize for cash flow? More appreciation potential? Identifying this will help you align your city/town selection with your financial goals.
If you’ve been thinking about investing in real estate – especially if you might invest long-distance – you’ll love this episode.
Enjoy!
For more information, visit the show notes at https://affordanything.com/episode373
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