ASSET = ONLY REAL ESTATE

We as nation need to come out of the mindset of hoarders of real estate for investment – that too, unproductive real estate and the business of plots and files. I agree, that unless the government plans for discouraging this unproductive asset class of barren plots, the general public will not refrain from going for it, but at the same time, we have to understand that not all the real estate is productive and provides returns which fulfils your requirement.

Apart from inherent risk that a plot of land might not appreciate in value for many years in future, or it wont appreciate as much as to beat the inflation itself – there are other risks and inherent issues of real estate like these investments are not liquid and are without any major cash flow. For that mater, although, I am not totally against purchasing of plots – but at the same time I am a proponent for balanced approach. Your portfolio of investment should contain rental properties, good amount of exposure to stocks, some gold (which we have talked earlier that it should not amount to more than 7-10% of your net worth) as well as some bit of plot of land in a safe area.

I have referred to it earlier, the reason we always point towards stable returns of real estate is that we keep invested in the asset for the longest time for any asset class. If you give the same amount of time to stocks that you gave to real estate, the returns are many fold. I am already working on a video for that topic where i will discuss returns of real estate vs stocks – stay tuned for that 🙂

In case you missed any of the videos for last week, here is the round up for you:

Keep hustling 🙂