It sounds like the writer had a bit of an agenda in pushing real estate forward. But that's the nature of writing with a particular bias. Strangely enough I was having a conversation with a friend about an hour ago discussing whether I could write an article on art investment. By my background I'm all about equities, but clearly to push forward the art story I've got to find a narrative that puts down stocks. If you search hard enough and make it easy enough for someone to understand you can always create a story for and against an asset class.
I'm pretty sure there is more risk to buying a rental property than investing in the stock market. You can't just simply sell a property and the price of selling a property is time consuming and costly. Not to mention that you have to find renters and keep the property in good shape...
I think one golden rule is to make sure you know what your doing, when it comes to investing in the stock market. While it might sound simple, I think a lot of people don't and they just think it's an easy way to make money, and that's not the case at all.
Some people have the idea that if they cannot touch it, feel it, see it, etc with their own eyes that it's not a "real" investment. I certainly don't agree with such people - shares of publicly traded companies that provide very real products and services, and who often have very real assets and equity are definitely real. And some believe only in investing in things that they have direct control over. It may be true that they have more control if it's all or mostly their money, and it's their own management of companies they own. But that isn't necessarily a good thing - I personally came to the realization many years ago that many people know how to do many things better than I can. Also, no one can actually control what the real estate markets or any other markets will do. And just because they bought a great property in a great place at a great time, it doesn't necessarily mean the investment will go great. And if they want or need to sell, they may not be able to sell as quickly for as high of a price as they think they might - even in a strong market. There are no guarantees in any investment. Ask Donald Trump if real estate doesn't have its ups and downs.
Investing in stocks is like betting if you don't know what you're doing. While stock markets are extremely volatile, it is not exactly a hit and miss game entirely. Lots of people can attest that they have earned money from stock investing. It's a matter of knowing your investment horizon and choosing quality stocks. I believe all forms of investments have a risk factor attached to it even rental properties. That's why it is crucial that anyone who wants to invest must take the time to study and understand what their getting into.
People have no control over the value of real estate either. It has not been a reliable year-on-year winner for quite a long time. And unlike stock, real estate depreciates, wears out, falls down in storms etc etc. IMHO it takes a lot more up front capital, time and skill to make money from rental property than to make a similar gain in investments. And property is, by definition, less diversified. You can invest in rental, but you can't "rental" in investment markets.
Bad weather causing possible property damage, maintenance and repairs, flaky tenants, down markets, lack of immediate liquidity, etc. Yes, RE has its share of risks.
There was a "buy-to-let" boom in the UK during the last decade, when credit and leveraged mortgages were easy to secure. People bought property with the intention of being landlords, and everyone thought this would be the route to a guaranteed profit. What actually happened was that investors realized that the profit margins on "buy-to-let" were tiny, and the hassle of running a portfolio of properties was a full-time job. Once the housing market slowed many people were ruined, and nowadays we don't hear an awful lot about "buy-to-let" in the media anymore.
