Last week Julie had an article published on the blog My Wife Quit Her Job called “Why Real Estate Made Me a Millionaire and Investing in Stocks Didn’t.”
The article sparked some interesting conversations between us and our friends. The interesting thing that came out of those conversations is that most of our friends think real estate investing is too stressful!
O.k., maybe I have spent too much time telling them the horror stories from the mistakes that I made with a couple of multi-unit properties that I bought in Niagara Falls, Ontario. The thing is – those stories are good enough for a t.v. movie!
Julie and I both find it easier to tell people about the dumb things we’ve done while real estate investing, than about the $5,000 in rent cheques we took to the bank yesterday.
When our friends commented on the stress of investing in real estate I had to ask how many times in the last month they have checked on their stock investments? The guys around the office talk about their stocks constantly! And our friends, it turns out, check their stocks at least once a day! And two of my good friends just lost 40% and 50% of the money in their stock portfolio in less than 6 months!
You can’t tell me that watching your stocks ride the crazy market rollercoaster EVERY DAY is less stressful than owning good real estate.
I do follow the residential real estate market and news pretty closely, and I see the average house in Canada has dropped 9% in value since last year, but I don’t worry about it. My tenants paid down about 5% of the mortgage, so I have only “lost” 4%… and in some cases, that property also put cash in my pocket after the expenses were paid. And, of course, I only really “lose” the money when I sell my property.
Real estate investing can be very stressful if you manage your property yourself, but if you hire good property managers, like Julie and I do for most of our investments, you will go days without thinking about your property. And you will often go all year without actually worrying about it.
But there are a lot of reasons to love real estate, and I don’t want to be repetitive with Julie’s article so just click on over to My Wife Quit Her Job and check it out!