Property vs Shares: My Debate with Owen Rask on the Great Australian Dilemma

Recently, I had the pleasure of joining Owen Rask on the Rask Australia podcast to tackle a topic that has long divided Australian investors: property vs shares. As someone who champions the stock market, I was eager to present my case. And, if I may say so myself, I think I won the debate. But let's not get ahead of ourselves.

The Age-Old Debate

The debate was moderated by Kate Campbell, who set the stage for a lively discussion. Owen, naturally, took the side of property investment while I argued in favour of shares and ETFs. The conversation delved into various aspects, from Australians' emotional attachment to property to the tangible benefits of owning shares.

The Tangibility Trap

One of the first points I raised was the "tangibility trap." While it's true that you can walk into a house and admire your lovely bathroom, you can't do the same with a share. However, this tangibility often blinds people to the benefits of diversification that shares offer.

As I pointed out, when you invest in property, you're putting all your eggs into one basket—sometimes even borrowing eggs from the bank.

Diversification: The Game-Changer

I emphasised the importance of diversification, a highly valued principle at InvestSMART. With shares, especially through ETFs, you can diversify your risk across various sectors and geographies. This is where our InvestSMART Diversified portfolios come into play.

These portfolios use ETFs to diversify and allocate to different asset classes, all with capped fees.

Transparency and Regulation

Another angle I explored was the transparency and regulation in the share market. Unlike the property market, where prices can be opaque and the industry less regulated, the share market offers a level of transparency that can empower investors.

The Verdict

While Owen made some compelling arguments for property investment, such as the capital gains tax benefits and the emotional comfort it provides, I believe the points I raised about diversification, liquidity, and transparency tipped the scales in favour of shares and ETFs.

InvestSMART Bootcamp

If you want to delve deeper into these topics, consider joining the InvestSMART Bootcamp I run. The Bootcamp covers everything from budgeting and investment planning to diversification and investor psychology. It's a comprehensive guide to making informed investment decisions. Enrol now.

Conclusion

So, who won the debate? Well, if you ask me, I'd say the shares team clinched it. But the real winner here is the informed investor who understands the pros and cons of both asset classes and makes an educated decision.

After all, why put all your eggs in one basket when you can diversify?