This is a question that has plagued several generations before us. So, which is the right one? It is hard to give a clear answer as each has its pros and cons. You may want to invest in the stock market as everyone around you seems to be doing it and it doesn’t take much of your time or money to purchase stocks. Investing in stocks or in upcoming properties in Bangalore is purely a personal choice that is dependent on your finances, tolerance to risk and financial goals.
Buying stocks means buying a small part of the company. As the value of the company’s stock grows, so do your earnings. By investing in real estate, you acquire land or an upcoming property in Bangalore. You make money by collecting rents or through appreciation as the property’s value goes up. There are several factors that you need to consider before you make a decision.
Additionally, you can harm yourself when you do not diversify your holdings. Due to the high volatility, there are chances of panic selling resulting in a capital gains tax thus increasing your tax burden. When it comes to real estate, one of the major mistakes that most buyers do is not doing their research well. There is no instant gratification in real estate. It is not an asset that you can liquidate easily. But you can get rental income and the assurance of an appreciation of your upcoming flats in Electronic City in the near future. Some of the major pros that are involved in investing in real estate are that it is easier to understand, investing with debt is safer in real estate when compared to investing with debt in stocks which is popularly known as margin trading. You have major tax benefits as well.
Equity investments tend to be unpredictable and the return on investment is not always what you’d expect. There are several types of risks involved while investing in stocks like market, economic and inflationary. There are also other instances where the volatility can be caused due to geopolitical events. If the country in which the organization is situated is facing an economic downturn, this will reflect poorly on your share value. Various factors like monetary policies, taxation changes or revision in the country’s interest rates can affect your share value. To buy flats in Bangalore or anywhere else, you should be able to secure your financing well. To answer your question; you need to ask some hard questions to yourself.
Will you have time to manage your upcoming properties in Bangalore especially if they are far from where you live? If you are thinking of equity investments, do you have financial personnel to assist you?
Are you well equipped to deal with the volatility of the stock market through all of its ups and downs? Once you answer all these questions, you will get a much clearer picture of what is right for you.