Investing newbie here: pros cons of getting a rental property vs investing in stocks?

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If you’re a newbie look into duplex / triplex and live in one of the units. Or buy 3+ bedrooms and rent out the extra bedrooms. Google ‘house hacking’.

Or if you’re just interested in RE as an asset class check out places like fundrise, or a traded REIT (eg VNQ)

Flipping only makes sense if you’re a GC with a crew. Buy and hold single family home is low return. The money is in larger multi family, and in commercial, which is a tough place to start.

On the other hand, its almost zero effort to get pretty good returns with a balanced portfolio of stocks!

likehelpful

Search the bowl

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All my fiends and family that have rental properties are sitting pretty .

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One is relatively active and one is relatively passive income (depending of course on how you approach it)

Op , have you considered purchasing something to start where you live in one section and then rent the rest ? Two family or Mother / daughter type home

I had a cousin who went all-in in the either/or choice, buying a second home instead of a penny into his 401k. In about 2005, before the crash. It did not end well and I bet he will retire in poverty.

Got it, so it’s just harder to do and takes a lot of work but if you do it right he returns can be higher

Not sure I would necessarily say “higher returns”.

If you inherit grandmas Manhattan condo and rent it out then yes, you can make a killing. If you buy a single unit somewhere to rent out, your returns will be very low.

Google cap rate and cash-on-cash return to get a sense for what these are and what typical ranges are. Then compare this to what at conservative 60/40 portfolio would generate over 10 years.

Likely better returns, and your 60/40 portfolio won’t call you in the middle of the night to tell you the toilet is clogged. :-)

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