Shares outperform property as long-term investment
According to research by Bestinvest, shareholders have seen a better return on investment over the last 25 years than those who chose to invest in a second property.
Individuals who bought the FTSE All Share index or the FTSE 100 in 1986 and reinvested the dividends received returns of 1110 percent and 1165 percent respectively.
While these figures dropped to 1086 percent and 1139 percent when the crisis of this August was taken into account, they still dwarfed the 471 percent rise in residential house prices over the same timeframe. Properties built since 1985 demonstrated returns of 378 percent.
However, the key point is that the dividends needed to be reinvested rather than taken as income, as more than 75 percent of the total return for the FTSE 100 came from income reinvestment.
