Stocks vs. Real Estate

Both real estate and stocks have had their day, but the question you need answered is this: Which contender is the superior long-term bet today?

Transparency
Round 5
Transparency
One share of Google common stock is the same as every other share. The price is updated constantly, and it is accessible to anyone. Each piece of real estate, on the other hand, is unique. Buying or selling at the "right" price is, at best, an educated guess. At worst, you're a sucker.

An easy round for stocks? Think about Enron, Tyco and WorldCom. All were widely followed by investment professionals, their results audited, their financial reporting regulated by the feds. And now their CEOs are in jail and investor losses total in the tens of billions. If Wall Street failed to notice anything amiss, how would you?

Real estate, on the other hand, is tangible. You can check the basement, consult a termite inspector and make sure that nobody is building a pig farm next door. Of course, if you've watched Flip This House and Flip That House, two cable-TV programs that feature people trying to get rich quick by buying and fixing up properties, you know that savvy folks often learn too late that the plumbing is shot or that vermin ate the wiring.

Still, John T. Reed, editor of "Real Estate Investor's Monthly," insists that such mistakes are avoidable - just not easily avoided. "You can verify the property taxes, the cost of utilities and everything else about the property," he says. "Those are knowable."

Performance Leverage Costs Taxes Transparency Effort Volatility Diversification Decision
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Market indexes are shown in real time, except for the DJIA, which is delayed by two minutes. All times are ET. Disclaimer LIBOR Warning: Neither BBA Enterprises Limited, nor the BBA LIBOR Contributor Banks, nor Reuters, can be held liable for any irregularity or inaccuracy of BBA LIBOR. Disclaimer. Morningstar: © 2014 Morningstar, Inc. All Rights Reserved. Disclaimer The Dow Jones IndexesSM are proprietary to and distributed by Dow Jones & Company, Inc. and have been licensed for use. All content of the Dow Jones IndexesSM © 2014 is proprietary to Dow Jones & Company, Inc. Chicago Mercantile Association. The market data is the property of Chicago Mercantile Exchange Inc. and its licensors. All rights reserved. FactSet Research Systems Inc. 2014. All rights reserved. Most stock quote data provided by BATS.
Market indexes are shown in real time, except for the DJIA, which is delayed by two minutes. All times are ET. Disclaimer LIBOR Warning: Neither BBA Enterprises Limited, nor the BBA LIBOR Contributor Banks, nor Reuters, can be held liable for any irregularity or inaccuracy of BBA LIBOR. Disclaimer. Morningstar: © 2014 Morningstar, Inc. All Rights Reserved. Disclaimer The Dow Jones IndexesSM are proprietary to and distributed by Dow Jones & Company, Inc. and have been licensed for use. All content of the Dow Jones IndexesSM © 2014 is proprietary to Dow Jones & Company, Inc. Chicago Mercantile Association. The market data is the property of Chicago Mercantile Exchange Inc. and its licensors. All rights reserved. FactSet Research Systems Inc. 2014. All rights reserved. Most stock quote data provided by BATS.