A town crier steps out of the shadows, looks down his nose at you, and unrolls a parchment. He clears his throat and says:
Here ye, here ye, let it be known that, Jon Morrow, the Ruler of Real Estate, has thrown down the gauntlet.
He pauses for a moment, daintily pulls off his glove, and drops it to the ground.
His Majesty challenges all Personal Finance Bloggers of friend and foe alike to a duel of words, a debate on the superiority of real estate to stocks. If a challenger steps forth with sufficient insight to merit consideration…
He stops again to snicker at the idea.
… then he will earn a link from this blog and an official response, posted for the world to hear.
Rolling his eyes, the crier stuffs the announcement back into his jacket and pulls out another roll of parchment. He hands it to you. Curious, you unroll it and begin to read:
Why Real Estate Beats the Crap Out Of Stocks
#1: Nothing down Magic
You can buy it with nothing down! For nary a penny of your own money, you can buy millions of dollars in real estate and resell it for an instant fortune. Where in stocks can you turn nothing into something? Nowhere, I say!
#2: The Lazy Way to Riches
With stocks, you have to spend countless hours pouring over data, crunching numbers, and reading the news. It’s too much work! In real estate, you have other people do the work for you. Mortgage brokers get you the money, contractors fix up the property, and realtors find the buyers and sellers. All you do is deposit the checks!
#3 Prettier Women
Have you seen the women in real estate? Vavoom! Invest in real estate and you’ll be surrounded by a harem of long-legged realtors, ready to serve your every need. Where are you going to get that in stocks? I mean, have you seen their women?
#4 Your Safety Is Guaranteed!
Real estate never goes down in value. Even if you have no idea what you’re doing, you can buy a property and sell it for what you paid to break even. People lose money in the stock market every day!
#5 Real Estate Always Appreciates
Sure, the stock market goes up in value, but nothing like real estate. Despite the bubble, prices are still going up, sometimes 20% or more per year. Buy all you can, hold it for as long as you can, and get rich!
#6 Make Enough to Quit Your Day Job
Who have you met that retired before the age of 30 by investing in stocks? Nobody! People in real estate do it everyday. Invest in real estate and you can retire in five years or less, but invest in stocks and you’ll be huddled over a keyboard when you’re 85.
#7 We Are the Master Race!
People that invest in real estate are genetically superior to people that invest in stocks. We are smarter, richer, and better looking. Join us or become our slaves!
—–
Nodding your head, you salute the crier and hand back the parchment. Grinning, he leans forward and says, “Nevermind any thoughts of a serious challenger. I dare any stockholder to step forward and challenge our decree. We’ll obliterate them in the public debate.”
He throws back his head and laughs, walking back into the shadows.
Digg this! | Tag for Del.icio.us | Send to reddit
Search
I’m involved with both stocks and real estate and I would say that people that are successful in either fields have different characteristics/attributes. The real estate people HAVE to be people oriented and extroverted. Where as stock traders are more analytical and can be introverted if they desire. By the way, I know of a good few people that trade stocks full time and are under 30.
FT
Hrmmmm, I love me some real estate, but just some thoughts… Side Note: I am snickering to myself as i respond. I aint laughing at you, but with you! Or maybe a little of both.. hehe
1) Nothing down Magic - You can always sell short! Sell it and hope the price drops so you can buy it cheaper to cover what you sold earlier in the day….
2) The Lazy Way to Riches - “In real estate, you have other people do the work for you. Mortgage brokers get you the money, contractors fix up the property, and realtors find the buyers and sellers. All you do is deposit the checks!” hahaha Did you actually type that with a straight face? hehe If you aint the one covering your arse, who is?
3) Prettier Women - Oh, as a fresh starting out real estate agent, I have to agree with you there… I just hope I can counteract some of that beauty with my smarts and saavy, in order to get some houses sold as a balding 30 something!
4) Your Safety Is Guaranteed! - Yes, you can get your money back, as long as you have time to wait for the right buyer! It only takes one buyer to give you what want… Course, time isnt something most people(or the banks) have a lot of!!!!
5) Real Estate Always Appreciates - “Buy all you can, hold it for as long as you can, and get rich!” Umm, doesnt this kinda go against rule 6??!?!? hehe You gotta make sure what you are buying is the best investment, or you could be better off buying govt bonds, or just putting your money in savings.. hehe
6) Make Enough to Quit Your Day Job - OOoh, but then wont this become my day job? I cant tell how old you are in your pictures, but somehow I dont see you retiring anytime soon? hehe
7) We Are the Master Race! - “We are smarter, richer, and better looking.” Did I mention the balding 30 something earlier in this comment? i think I did! hehe
Love the blog, but keep em coming.. This one update a week thing is for the birds! I thought all you had to do was sit back and “deposit the checks!”.. Surely you have enough time to post some more to this blog?!?! You wont become a best selling author with this lazy attitude!! /tease
Hahahaha….. a good laugh out of this one, but I was actually hoping for some good solid reasons to turn to real estate instead of stocks! (which is what I’m doing anyway, so I guess I just need the validation)
He! That was hilarious! I love your blog - and I can’t wait to read more.
~Swintah
1. Trade on margin?
2. Guaranteed to lose money this way. No successful real estate person I know relies on everyone to do everything for them. All the checks your receive go to others this way.
3. How could this possibly matter.
4. Bullsh*t. This is clearly written by someone who has never been alive during a bear housing market. While nominal housing prices may never drop, that does not mean your real value has not declined, due to inflation.
5. Same as 4. Transaction costs in real property are the highest for any asset you can own outside of an partnership interest in a small business.
6. Have fun making sure your tenants all pay you on time and successfully evicting them if they don’t (no costs there right?)
7. HA! (Was this all some snarky joke, I may not have gotten it?)
The Dough Roller slowly rolled up the parchment as he pondered the great riches and fame that surely would follow–as the night the day–a link on the Real Estate Mega Book blog. He reached down and with mighty determination lifted the heavy gauntlet that had been cast down by Jon Morrow, the Ruler of Real Estate. A hush fell over the crowd and all eyes settled with fear and trembling on the Dough Roller, as the great wisdom of The Ruler was known far and wide. With a nervous voice the humble Dough Roller began to speak:
“It is with honor that I accept The Ruler’s challenge,” The Dough Roller began.
But before he could continue, a voice cried out from the crowd, “Sire, don’t you yourself own property across this great land? Surely you cannot argue that the stock market is a better investment than real estate!”
“It is true, as you say,” replied the Dough Roller, “I do own real estate investments, as well as stock mutual funds. Would you not agree, though, that by owning both, I am well suited to respond to The Ruler’s challenge, if any response can be deemed worthy?”
A murmur of agreement arose from the crowd and then silence descended again as the Dough Roller collected his thoughts. “Ladies and gentleman,” he began, but was interrupted again.
“Hey, Dough Roller, you own the home I live in, and the roof is leaking. I told you a week ago about this problem, and it’s still not fixed!”
“Oh, is that you Mr. Franklin. I, I have two estimates for the cost of the repairs. $3,500 is a lot of money, as I’m sure you’ll agree. I’m getting a third tomorrow. I traveled to the home two days ago to meet with one contractor, and he never showed up. Funny how contractors and prospective tenants alike never seem to call when they blow off an appointment. But mark my word, kind sir; we’ll have it taken care of soon.”
Frazzled but determined, the Dough Roller continued, “Stocks are better investments than real estate because,” and there came yet another interruption.
“Yea, I live in one of your homes, too. My roof is fine, but the air conditioner is broken and we have a leak somewhere in the house because water is all over the new carpet you installed.”
“Hi, Ms. Rosa, it certainly is good to see you, again. I, I haven’t forgotten about you. In fact, a plumber will be at your house today to repair the leak. It’s a lot of work, what with having to break open the slab foundation and all to get to the leaking pipe. I sure wish the home had a basement,” the Dough Roller said with a nervous laugh. “And the HVAC repairman will be there tomorrow. Please be patient.”
Now visibly shaken, the Dough Roller tried to regain his composure and with a resolve and perseverance that can come only from years of real estate ownership, began again: “Stocks are better investments than real estate because,” and a final interruption thundered from the now angry crowd. “Mr. Dough Roller, you’re late on two mortgage payments to my bank. We’ve been looking for you for some time and would still not have found you had you not been so silly as to pick up The Ruler’s gauntlet.”
“Oh, Mr. Burns, it’s always a pleasure to see you,” the Dough Roller stammered to the keeper of Other People’s Money. “I’ve been meaning to stop by to explain. You see, some tenants haven’t been paying their rent. But not to worry, proper lawsuits have been filed, and rest assured, the judges in landlord/tenant court are diligently considering my case. I’m sure I’ll have the current tenants evicted and new tenants installed in no time.”
But it was too late. The crowd’s anger at the Dough Roller’s foolish effort to challenge The Ruler was quickly getting out of control. Sensing imminent danger, the Dough Roller turned and sprinted in fear to his nearby office, which he reached with the crowd on his heals. Locked in his office, an angry mob banging on his door, he slumped into the chair behind his desk with head in hand.
In near tears and with all hope abandoned, his eyes gazed upon the mutual fund statement on his desk. A mutual fund that never missed an appointment; never called; never needed a new roof or air conditioner; never leaked; never needed evicting—just quietly returned a fair profit. Oh, the joy. The Dough Roller hugged that mutual fund statement with glee. “Yes, the stock market is a better investment,” he exclaimed.
And then a parchment on the edge of his desk caught his attention—“4 bd, 2b, fp, fbsmt, fncd, good sch. Need to sell. Only $124,900. No money down!” Now that’s a good deal, he said as he dropped the mutual fund statement and picked up the ad. I need to see this place, if only I could get through that angry mob.
As the knights of valor prepare to battle, a solitary squire steps up to serve, as he has become faithful to both.
The Lord Stockton of Paper has been decent to him. Sure, he has demanded all of his investment up front, but his returns in percentage outperform all throughout the lands, with no exceptions.
The Land Baron of the Estates of Real; however, has yielded more in real dollars because of his wonderful mistress, Queen Leverage. The generous Queen allows the young squire to keep all the future profits of the lands he does not fully own.
The loyal squire’s heart tells him to stick with Lord Stockton, for when mass fortunes are eventually aquired, they will grow more generously and effortlessly in his hands. His mind, however, encourages him to stop waiting and to choose the Land Baron, as in terms of real dollars, he has bestowed many more gifts while asking little in return.
Having not done the proper research before doing battle, the squire is perplexed. He decides then to sit out this fight and allow the knights themselves to battle it out and prove their worth.
Dear Doughroller,
A pretty smirky one. Well told. Quite poetic. But you obviously haven’t heard of the emerging role of the Hassle-Free PMC - Property Management Companies. A smart real estate investor’s modern cop out to the lazy boy days. Guess you’re so used to racking up your brain and working hard, you’re all brained out.
And if you were a real Real estate investor you would be driving not running away from the crowd. You probably invested in dead beat properties. You’ve been hanging with the wrong crowd.
By the way, I heard you’re not doing so well since your last posting. You’re tired and exhausted… of running away from the Bear Stearns stock mob…whose money you invested. Heard the stock recently fell from a 2007 high of $158.39 to a mere $30 in just 2 days. And now all the pissed off retirees are trying to hunt you down, burn your crib and maim you before feeding you to the sharks. Then again stock investors are known to be sharks. I guess your buddies won’t mind eating you up. So roll along. sucker.
The value of one of my Saint Lucian $200,000 real estate investment just quadrupled in a mere 3 months…and I didn’t even rent it out or upgrade. I suggest you check out my Realtors. Publicly concede your defeat and I will send you a link to the greatest Saint. Lucian luxury property secrets.
Yours truly,
The Property Mogul (at the beach sipping fruit punch. I don’t need to work anymore.)