MENU

3 reasons all property buyers should own shares

Property investors should all consider owning shares. Am I simply biased? Well…yes. But there are things in the minds of property investors that can make them much better shareholders than the average punter. Here are 3 good reasons that all property investors should consider owning shares:

  • To benefit from a long-term owner’s mindset

Unless they’re speculating with interest-only loans, property buyers generally have a much longer time-frame than the average stock market investor. A long-term time frame combined with shares in an attractive business can do wonders for your investment returns.

Just consider if you’d identified these promising companies and held them for the long term:

Woolworths Limited (ASX: WOW) – up 400% before dividends since 1999

CSL Limited (ASX: CSL) – up 865% before dividends since 1999

Commonwealth Bank of Australia (ASX: CBA) – up 224% before dividends since 1999

Comparable with the Sydney housing market, actually, where the median house price has risen 400% since 1999. But if you owned shares, you never spent a cent on repainting, maintenance, insurance, rates, valuing your property, agent fees, and the weeks when there were no tenants. Not to mention that Sydney is an outlier, with the rest of Australia not having performed so well.

  • To benefit from your investigative skills

Think about all the work you do before you buy or rent a house. You research the market, value the property, drive around the neighbourhood, hire people to check for termites, and so on. You already know what it takes to make a safe investment decision.

You can apply these skills to stocks by doing a little research into a company’s prospects, products, and competitors. You already know what good products are, and more importantly you can identify if the process for doing something (for example, getting a loan) is bafflingly obtuse. This could give you an edge in spotting a company that does it differently, or better.

  • Because it’s easy

You don’t have to take out a loan to buy shares, nor do you have to tip in extra money if interest rates rise or the company is unprofitable. Furthermore, shares don’t require maintenance, although like with property, paying for professional advice can be valuable. And, if you buy profitable companies with minimal debt like Flight Centre Travel Group Ltd (ASX: FLT), the businesses are very unlikely to go bankrupt. This doesn’t mean that they are a safe investment, but the chance of them going to zero becomes much lower.

I am convinced that the approach employed by property buyers would prove very useful in the stock market.

Of course, even the best approach will be for naught if you can't find good businesses to buy. That's where we come in:

Top 3 ASX Blue Chips To Buy In 2017

For many, blue chip stocks means stability, profitability and regular dividends, often fully franked..

But knowing which blue chips to buy, and when, can be fraught with danger.

The Motley Fool's in-house analyst team has poured over thousands of hours worth of proprietary research to bring you the names of "The Motley Fool's Top 3 Blue Chip Stocks for 2017."

Each one pays a fully franked dividend. Each one has not only grown its profits, but has also grown its dividend. One increased it by a whopping 33%, while another trades on a grossed up (fully franked) dividend yield of almost 7%.

If you're expecting to see the likes of Commonwealth Bank, Telstra and Wesfarmers shares on this list, you'll be sorely disappointed. Not only are their dividends growing at a snail's pace, their profits are under pressure too due to the increasing competitive environment.

The contrast to these "new breed" blue chips couldn't be greater... especially the very real prospect of significant share price gains, something that's looking less likely from the usual blue chip suspects.

The names of these Top 3 ASX Blue Chips are included in this specially prepared free report. But you will have to hurry. Depending on demand - and how quickly the share prices of these companies moves - we may be forced to remove this report.

Click here to claim your free report.

The Motley Fool Australia's parent company Motley Fool Holdings Inc. owns shares of Flight Centre Travel Group Limited. Motley Fool contributor Sean O'Neill owns shares of Flight Centre Travel Group Limited. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

Two New Stock Picks Every Month!

Not to alarm you, but you’re about to miss a very important event! Chief Investment Advisor Scott Phillips and his team at Motley Fool Share Advisor are about to reveal their latest official stock recommendation. The premium “buy alert” will be unveiled to members and you can be among the first to act on the tip.

Don’t let this opportunity pass you by – this is your chance to get in early!

Simply enter your email now to find out how you can get instant access.

By clicking this button, you agree to our Terms of Service and Privacy Policy. We will use your email address only to keep you informed about updates to our website and about other products and services we think might interest you. You can unsubscribe from Take Stock at anytime. Please refer to our Financial Services Guide (FSG) for more information.