Are shares or property a better investment?

Both can build wealth. Property lets you borrow heavily, so a modest deposit controls a large asset and gains are amplified, but it is illiquid and has high costs. Shares are liquid, low cost and easy to diversify, but you usually invest unleveraged. The better choice depends on your goals, risk tolerance and effort.

Why does leverage matter for property?

With a 20% deposit you control five times your money in property, so even modest price growth produces a large return on your deposit, but losses are amplified too. Shares are usually bought with your own money, so returns track the market more directly.

Does this include rent and costs?

This is a simplified growth comparison on the asset values and your starting capital. It does not model rent, mortgage interest, tax or maintenance, which matter a lot in practice. Use it as a starting point, not advice.

Shares vs Property Calculator

This New Zealand calculator compares the long-run growth of investing your capital in shares against using it as a deposit on a rental property, where borrowing amplifies the gains. It is a simplified view of the asset growth, not a full model of rent, interest and tax, but it shows how leverage changes the picture. You enter your capital, expected returns and time frame, and the tool projects each side.

Capital to invest

Shares return per year

Property growth per year

Deposit for property

Time frame (years)

larger projected gain (asset growth only)

Shares value$0

Property equity$0

Highly simplified: shares grow your capital at the share return; property uses your capital as a deposit to buy a larger asset that grows at the property rate, with the gain magnified by leverage. It ignores rent, mortgage interest, tax, costs and risk, which are crucial in reality. Estimate only, not advice.

How it works

For shares, the calculator grows your capital at the share return over the years. For property, it treats your capital as the deposit, so you control an asset worth capital divided by the deposit percentage; that whole asset grows at the property rate, and the gain (which all accrues to you) is added to your starting equity. This shows the leverage effect: a lower growth rate on a much larger asset can still beat unleveraged shares, though the risk and costs are far higher.

Worked example

$150,000 in shares at 7% over 20 years grows to about $580,000. As a 20% deposit it controls a $750,000 property; at 4% growth that property reaches about $1.64 million, an equity gain that, added to the deposit, can exceed the shares, illustrating leverage, before rent, interest and costs are counted.

Related calculators

Property Investment Calculator: full property model.
Investment Calculator: investing growth.
Rental Yield Calculator: rental returns.
Compound Interest Calculator: compounding.

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