Would you invest in the stock market or property?

inferno · 12 Feb 2016 at 12:48

If you had 100k would you invest in the stock market or property?

I'm thinking property is a better investment since you will leveraged, if you have 100k you could buy a 350k apartment taking into account stamp duty etc. Fees are much higher than buying shares, but a 5% rise on your apartment if it is leveraged is very sizeable. You can also rent it out and pay large fees for it to be managed but someone is still paying a chunk of the mortgage.

Shares though can get 4% dividends with little to no overheads if you do it by yourself.

What do you guys think? I keep on seeing that London prices will keep going up even if there are some bumps or crashes along the way!

Krono5 · 12 Feb 2016 at 12:53

You can also leverage shares/forex etc

Property is very safe and ultimately you own something tangible. With the stock market you have a lot more choice in risk/reward.

Judgeneo · 12 Feb 2016 at 12:57

Property prices have risen a lot, but over the long term the FTSE has risen more, quite a bit more.

The only reason you should invest in property is if you will be adding value to it yourself.

Krono5 · 12 Feb 2016 at 13:00

Judgeneo said:
Property prices have risen a lot, but over the long term the FTSE has risen more, quite a bit more.

The only reason you should invest in property is if you will be adding value to it yourself.

The value added would surely come from rent though which is maybe 5% a year give or take minus the leverage interest.

Azza · 12 Feb 2016 at 13:01

This and then this if I wanted some extra property specific allocation.

Glaucus · 12 Feb 2016 at 13:05

Personally a debt free rental property.

It's a nard time tot invest, I don't think global economics is good and that the end of the recession mantra is a bit to positive. Imo we will have decades of world economy bouncing all over the place.

But a financial advisor is your best bet, rather than randoms from the internet, all with different ideas and opinions.

nightwish · 12 Feb 2016 at 14:49

Stock market. More diverse, more liquid, less hassle.

Though, it does depend on your situation, duration of investment, risk profile, etc.

D.P. · 12 Feb 2016 at 14:52

Stock market, distributed risk, much more easily accessible, no surprise costs like a roof collapsing, different options for risk-return, and long term gives much higher returns than property.

Nitefly · 12 Feb 2016 at 14:56

Property - once you have tenants paying off the mortgage.... lololol

dowie · 12 Feb 2016 at 14:57

inferno said:
I'm thinking property is a better investment since you will leveraged, if you have 100k you could buy a 350k apartment taking into account stamp duty etc. Fees are much higher than buying shares, but a 5% rise on your apartment if it is leveraged is very sizeable.

well your premise is flawed to begin with - you can have a leveraged investment in the stock market too

so your 100k could be used to buy a 350k property or 350k in shares

dowie · 12 Feb 2016 at 14:57

Krono5 said:
The value added would surely come from rent though which is maybe 5% a year give or take minus the leverage interest.

and companies pay dividends...

both rental yields and dividends vary

chief barker · 12 Feb 2016 at 14:59

Gold!

The world's economy is collapsing

lee1101 · 12 Feb 2016 at 14:59

s452 · 12 Feb 2016 at 15:02

first question I would ask is are you renting or do you own your home?
if you own it and you still have an outstanding mortgage, I would strongly look into how much of a dent that 100K can make to your repayments first.
if renting (and you plan to stay in the area long term), consider using the money as a payment to get a mortgage/buying a property outright? (at the end of the day, you'll be left with owning a property which if you decide to move later on, you could always rent out)

dowie · 12 Feb 2016 at 15:04

s452 said:
f
if you own it and you still have an outstanding mortgage, I would strongly look into how much of a dent that 100K can make to your repayments first.

I wouldn't - mortgage rates are super low at the moment, I don't see any reason to make overpayments if you're able to get a better return than your mortgage interest rate elsewhere

Krono5 · 12 Feb 2016 at 15:05

chief barker said:
Gold!

The world's economy is collapsing

I see your Gold and raise you Oil, after all the Americans have got to start bombing someone else in the middle east soon

G-MAN2004 · 12 Feb 2016 at 15:16

Blackjack and hookers.

jsmoke · 12 Feb 2016 at 15:18

I think you should find an advisor that you can trust and who knows that hat their talking about.

Clipsey · 12 Feb 2016 at 15:28

Krono5 said:
I see your Gold and raise you Oil, after all the Americans have got to start bombing someone else in the middle east soon

Especially if a Republican gets in, oil prices will shoot up again surely.

daz · 12 Feb 2016 at 16:01

There's nothing complex to think about here, I'd imagine you just want to preserve (and hopefully grow) the money, aiming to beat inflation?

Max out your ISA, probably best in some kind of tracker vehicle.
Put some in to P2P lending.
You should have a decent amount left which you can put in to a property but consider the new stamp duty rules.

Make sure you leave some cash for a rainy day (6 months expenses should be OK - leave in Santander 123 @ 3% or something).