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SHARES versus REAL ESTATE
Rank: Elder Joined: 11/19/2008 Posts: 1,267
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Also see: http://www.wazua.co.ke/f....aspx?g=posts&t=6109Isaiah 65:17-Look! I am creating new heavens and a new earth, and no one will even think about the old ones anymore
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Rank: Elder Joined: 6/27/2008 Posts: 4,114
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It's one thing to buy a piece of land, sit on it and do nothing and then sell it later at a "profit"; It is a different story to buy the plot, put some development and sell it at a profit. The first case is going round in circles; It is old-school thinking The second is doing real work; it's what Trump does. It is also what the new Real-Estate barons are doing. The only problem with Real estate is that it needs a huge capital investment up-front. Share on the other hand can be accumulated in small chunks over time - you can even invest less than 5k at a time. Nothing is real unless it can be named; nothing has value unless it can be sold; money is worthless unless you spend it.
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Rank: Veteran Joined: 6/2/2010 Posts: 1,066
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mukiha wrote:It's one thing to buy a piece of land, sit on it and do nothing and then sell it later at a "profit"; It is a different story to buy the plot, put some development and sell it at a profit.
The first case is going round in circles; It is old-school thinking
The second is doing real work; it's what Trump does. It is also what the new Real-Estate barons are doing.
The only problem with Real estate is that it needs a huge capital investment up-front. Shares on the other hand can be accumulated in small chunks over time - you can even invest less than 5k at a time. One positive for real estate is that one can employ leverage substantially i.e. many banks would lend you substantial amounts to develop real estate. Shares on the other hand, well unless you take the unsecured personal loans or the limited loans offered on IPO purchases.... Whether debt (yes even debt for investment)is a good thing is a debate for another day
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Rank: Elder Joined: 6/19/2008 Posts: 4,268
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In my view, 60-40 in favor for real estate would do for me. It is true that stocks are good and are pretty liquid, but real estate is more predictable and more certain than shares..... tell an Uchumi shareholder to put all the money in shares - well, i know you will say there is hope in diversification but it does highlights the magnitude of something going bad....
Shares ride alot on market confidence, which is very volatile and sensitive and you have no control over.
With real estate, it has the advantage of leverage too as someone has said.
I would say, buy property when you are young - you may not afford them when you grow old.
Invest in shares when you are mid years and develop your properties....
In old age, play with shares full time because that you can do anywhere in the world as you play golf!
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Rank: Chief Joined: 1/3/2007 Posts: 18,103 Location: Nairobi
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@wendz - Ask a Kikuyu farmer (I did not bringing tribes into this but the reality in Kenya has to be faced for the moment) about land in RV & he might respond to you 'Never Again'... Leverage - You can do so in stocks as well... I am NOT advocating leverage just saying... If you were GOOD or LUCKY... U could have bought Equity at 16 (6 months ago) & now it is 24/-... so a 50% return on borrowed money... Greedy when others are fearful. Very fearful when others are greedy - to paraphrase Warren Buffett
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Rank: New-farer Joined: 12/31/2009 Posts: 43 Location: Tundra
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Wendz wrote:
In old age, play with shares full time because that you can do anywhere in the world as you play golf!
Hmmmmm....Ask all the baby boomers who had allocated 100% of their assets in stocks over the last two years, this can be risky and push your retirement a couple of years! Diversification (bonds/property)to less volatile assets will ensure your nest egg is not tanked in an over correction of the market. You won't have enough time to recover (Not YOU personally, just older wanainchi in general).
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Rank: Veteran Joined: 6/2/2010 Posts: 1,066
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[quote=Fundaah]Also see: http://www.wazua.co.ke/f...aspx?g=posts&t=6109[/quote] Fundaah, did you ever get back into the stock market? Or once burnt twice shy?
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Rank: Member Joined: 4/1/2008 Posts: 141
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Real estate ofcourse
50% real estate, shares 30%, 10%bonds
10 cash
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Rank: Elder Joined: 9/25/2009 Posts: 4,534 Location: Windhoek/Nairobbery
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AGE is the determining factor here e.g if u r 77 yrs old subtract that from 100 which is equal to 33 so if u r 77 u should put 33% in stocks and 77% in real estate but if u r young and strong like me u can put 100% in stocks(i'm yet to earn my 1st pay cheaque)...
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Rank: Chief Joined: 3/24/2010 Posts: 6,779 Location: Black Africa
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deal, going by your formula, shouldn't you be putting 75% into stocks? (assuming you are no more than 25 years) GOD BLESS YOUR LIFE
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Rank: Veteran Joined: 1/7/2010 Posts: 1,279 Location: nbi
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Age has nothing (zero) to do with whether you buy shares or real estate. I'd say the most important thing is your aptitude for research. Shares require continous research so if you are not that way inclined, avoid... The Governor of Nyeri - 2017
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Rank: New-farer Joined: 12/31/2009 Posts: 43 Location: Tundra
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Wa_ithaka wrote:Age has nothing (zero) to do with whether you buy shares or real estate.
I'd say the most important thing is your aptitude for research. Shares require continous research so if you are not that way inclined, avoid... I disagree.If you are depending on these investments for retirement, age has everything to do with your choice. If the market tanks and you are 60+ years, you lose your maney, and don't have enough time to recover... Unless you have other sources of income, it's a gamble putting everything in stocks when you are close to rudi mashambani.
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Rank: Chief Joined: 1/3/2007 Posts: 18,103 Location: Nairobi
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kenstat wrote:Wa_ithaka wrote:Age has nothing (zero) to do with whether you buy shares or real estate.
I'd say the most important thing is your aptitude for research. Shares require continous research so if you are not that way inclined, avoid... I disagree.If you are depending on these investments for retirement, age has everything to do with your choice. If the market tanks and you are 60+ years, you lose your maney, and don't have enough time to recover... Unless you have other sources of income, it's a gamble putting everything in stocks when you are close to rudi mashambani. Kurudi shambani (100%) is a HUGE risk too... Ask the 'retiree farmers' in RV who are now IDPs... Greedy when others are fearful. Very fearful when others are greedy - to paraphrase Warren Buffett
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Rank: Veteran Joined: 1/7/2010 Posts: 1,279 Location: nbi
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Warren Buffet & Geroge Soros (both 80); Chris Kirubi (60s?);Aly Khan (50s?) would all tell you where to get off if you told them not to dabble in shares? The Governor of Nyeri - 2017
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Rank: Veteran Joined: 6/2/2010 Posts: 1,066
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Did you know that Mac Donald's real business is NOT selling burgers and fries but actually REAL ESTATE. They have very valuable real estate in corners each important city. Some people speculate that if they were to tally the value of all their holdings (burger joints) then they are actually one of the richest companies in the world.
I have never looked at their their Balance sheet to confirm this :)
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Rank: Chief Joined: 1/3/2007 Posts: 18,103 Location: Nairobi
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My 2 cents wrote:Did you know that Mac Donald's real business is NOT selling burgers and fries but actually REAL ESTATE. They have very valuable real estate in corners each important city. Some people speculate that if they were to tally the value of all their holdings (burger joints) then they are actually one of the richest companies in the world.
I have never looked at their their Balance sheet to confirm this :) Stop mis-informing (hakuna malice) folks! MickeyD... 'rents' the real estate by getting 6% of the gross sales... In essence, they benefit from greater sales... The Real Estate is simply one tool (among others) to get people to buy more of their products... Greedy when others are fearful. Very fearful when others are greedy - to paraphrase Warren Buffett
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Rank: Member Joined: 12/16/2008 Posts: 111
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@VituVingiSana, fortunately My 2 Cents hasn't misled anyone. Probably, it is just the way in which he expressed himself that you didn' get.
Real estate is as important as fries and burgers are, to MacDonald's. They have some of the best spots as far as their business is concerned.
Most people think of real estate only in terms of having land and a building on it (a flat ama any other property. It also involves improvements on the land. MacDonald's have perfected this.
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Rank: Veteran Joined: 6/2/2010 Posts: 1,066
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Tito44 wrote:@VituVingiSana, fortunately My 2 Cents hasn't misled anyone. Probably, it is just the way in which he expressed himself that you didn' get.
Real estate is as important as fries and burgers are, to MacDonald's. They have some of the best spots as far as their business is concerned.
Most people think of real estate only in terms of having land and a building on it (a flat ama any other property. It also involves improvements on the land. MacDonald's have perfected this. I couldn't have said it better than you have 
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Rank: New-farer Joined: 12/31/2009 Posts: 43 Location: Tundra
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Wa_ithaka wrote:Warren Buffet & Geroge Soros (both 80); Chris Kirubi (60s?);Aly Khan (50s?) would all tell you where to get off if you told them not to dabble in shares? Well, yes, if you are a billionaire/millionaire/person of means. The average person who is depending on their portfolio to generate income for retirement will be taking a risk by putting it 100% in stocks when close to retirement.I work with atleast 6 people who have pushed their retirement out 3-5 years because of the market meltdown a couple of year ago. If you are a billionaire, there is really no need to "retire", your maney keeps working....
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Rank: New-farer Joined: 12/31/2009 Posts: 43 Location: Tundra
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VituVingiSana wrote:kenstat wrote:Wa_ithaka wrote:Age has nothing (zero) to do with whether you buy shares or real estate.
I'd say the most important thing is your aptitude for research. Shares require continous research so if you are not that way inclined, avoid... I disagree.If you are depending on these investments for retirement, age has everything to do with your choice. If the market tanks and you are 60+ years, you lose your maney, and don't have enough time to recover... Unless you have other sources of income, it's a gamble putting everything in stocks when you are close to rudi mashambani. Kurudi shambani (100%) is a HUGE risk too... Ask the 'retiree farmers' in RV who are now IDPs... I didn't mean that literally, just as an illustration of leaving the workforce/regular income job. I agree there is quite a risk in going to retire in warrior land...
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