Forum Archive Index - March 2004

["Duncan MacGregor" <d-m_macgregor@xtra.co.nz>]

We never think twice about borrowing to buy property, but as the recent posts on borrowing to buy shares shows, there appears to be double standards from people that tell us continually how the market beats property as an Investment.       I have always stated property over time Is safer than shares and more profitable, with very little of your own money Involved If you understand the game.           The downside risk on a well thought out property portfolio Is slight, where as the downside risk on the share market Is much higher to the extent where banks wont lend money without substantial security.    Property Is self supporting can be bought with 10pc deposit and doubles In value every 20 years on average with very low risk.   
Shares are more fun, a battle of wits know when to get out, listen to no one, Its a game to be enjoyed.               
The average share Investor makes the average rise In the market over a period of time, plus the average dividend .       Work that out over the last 20 years, and deduct the Interest on the money Involved, which would take care of the dividends, and compare that to property.    We always have exceptions to the rule, what I am saying Is for the average Investor with little money should stick to property, or If you are adventurous buy high risk cheap spec shares for the wild ride but never borrow to buy shares.  

                          cheers macdunk