Yahoo Finance What's the better investment: Real estate or stocks?
There’s a common perception among Canadians that real estate is the safest investment out there. New mortgage rules and provincial policies might have some rethinking that philosophy.
Canada’s hottest housing markets cooled in 2018, but the impact was not nearly as dramatic as the chill that came over stock markets.
Zoocasa crunched the numbers to compare the return on investment between key real estate markets and other investment vehicles.
If you shopped around — a high-interest savings account would have provided 1.1 per cent in interest. A fund tracking the S&P Canada Aggregate Bond Index, like XBB.TO from iShares, returned a modest 1.5 per cent. But a fund tracking the TSX, like XIC, would have resulted in a loss of 11.6 per cent.
A home in the Greater Toronto Area outperformed them all. The average price rose 2.1 per cent to $750,180.
Buying a home in Vancouver didn’t pay off in 2018. The average price fell 1.7 per cent, to a still lofty $1,032,400.
Calgary was relatively flat, down 0.9 per cent to $449,361.
These numbers represent a small snapshot during a down year for equities. But for 2018, buying a home in the GTA, Vancouver, or Calgary would’ve been a better investment than the broad basket of Canadian stocks.
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