Real Estate vs Mutual Funds: Which is a better investment option for you?

financialexpress.com:

When it comes to investing, real estate and mutual funds are two popular options. Both have their intrinsic advantages and disadvantages, and it is imperative for the investor to understand these difference so that they can make informed decisions. At the same time, it is also crucial to be aware of their relative merits and demerits before taking the plunge.

First and foremost, real estate investments are generally recession-resistant. While mutual funds could be volatile and subject to economic downturns, real estate tends to be more stable. During uncertain times, property values may decline temporarily. However, they typically recover in the long run, making real estate a reliable investment choice.

Real estate investments also have the potential to leverage finance. Even though it requires a significant sum of money beforehand, reputed banks provide loans for up to 80% of the property’s value, allowing investors to multiply their purchasing power. For first-time homebuyers, this means saving on rental expenses. In contrast, the rental income generated can often cover the monthly mortgage payments within a few years for those investing in additional properties.

Also Read: Maximise your credit card usage with never-expiring reward points

“Real estate is the only tool for long term wealth generation and people don’t tend to encash profit at every high since it’s comparatively less liquid than mutual funds and its value increases with time. It also provides exceptionally high returns in the long term. Besides, realty is a prized asset; it adds to the net worth of the owner, making it extremely beneficial. This can be leveraged financially to fund other purchases. Further, one can easily fund one’s purchases as home