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SHARES
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DIRECT
PROPERTY
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Perform
better than property over the long term.
|
May
perform better than shares over certain shorter
periods but this is a timing issue.
|
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Allow
for diversification because funds can be spread
across various companies, sectors and regions.
|
Difficult
to diversify due to large amount of funds required
for each property.
|
|
Investors
can access the share market with relatively
smaller amounts of money.
|
Larger
amount of funds required for property investment.
|
|
Investor
can cash out small amounts at a time without having
to sell the whole portfolio.
|
Difficult
to make changes as you have to sell the whole
property.
|
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Shares
are a paper asset (not tangible) but more and
more investors are becoming comfortable with this.
|
People
have strong, positive experiences with property.
They understand it and feel more comfortable dealing
with it.
|
|
Investing
in shares is generally less expensive than investing
in property. Eg brokerage of about 1%
|
Property
involves higher transaction costs (eg stamp duty).
|
|
Management
of the investment can be outsourced to fund managers
and advisers.
|
Management
of property can be outsourced to agents. It can
be difficult to find good tenants. May encounter
long periods of time when property isn't rented.
|
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Shares
can offer tax benefits in the form of franking
credits.
|
Continual
ongoing costs of rates, agent's fees, repairs
and maintenance.
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