Stocks or Real Estate

I have about 200k invested into SPY right now, and I'm wondering whether I should take this money and buy a ~1m investment property to rent out. Ideally, I could get a 10 or 15 yr mortgage to build equity quickly and make a higher return than SPY. Is this a good idea? I am mainly concerned about being able to manage real estate while working long associate hours.

3 Comments
 

I could be wrong and the RE folks will probably chime in, but I notice that the multi-family properties that are 6-12 units usually have a slightly higher cap rate in the area where my parents live.  It might be due to some size arbitrage where a 6 unit place is to small for REPE, but just a little to big for your average non investor.  Leaveing a small pool of people that are millionaires that want the properties.  Granted its only a 50-200 BPS higher than larger buildings.  

 

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