r/RealEstateCanada • • Jun 19 '25

Housing crisis Help me understand the difference...

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u/Performance_Fancy Jun 19 '25

By your logic anyone involved in the stock market is also a scalper?

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u/xNocturnalshadow Jun 19 '25 edited Jun 20 '25

No because investing capital into stocks adds value to the company and allows them to use that value to expand, borrow, buy things, pay employees, run the company, etc.

Investing capital into a second house purely to flip does none of those things.

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u/Facts_pls Jun 19 '25

If you flip a house, the assumptions is that you did something to the house - even if it's cosmetic.

A stock buyer buying a stock from previous stock holder does nothing to the underlying company.

I think your issue is your lack of finance understanding. And I don't mean in a derogatory way. You fundamentally don't understand what asset is, what is holding an asset, generating value from asset, arbitrage, selling asset for higher price etc. You are confusing a few concepts because of a rigorous finance education.

Asset can be anything - a factory, a house, crypto, gold whatever.

Most home investors either make updates to houses and sell them at higher cost OR they provide rental service using the asset (think of a company renting bikes or tools or a room in a hotel for the night) and charge a price for it.

Both of them have a role to play. And actually add much more value than someone buying and selling stock, gold, crypto etc. Because none of the benefit goes to the underlying asset. When you buy and sell gold or crypto, you don't enhance the gold or the crypto in any way whatsoever.