Saturday, June 11, 2011

Invest In Real Estate NOW!!!!

About two weeks ago I received one of those unsolicited telephone calls from somebody who wanted to change my entire investment portfolio and guarantee me a 10% return by investing in the futures market.

"Sorry", I said, "but I'm investing in real estate from now on."

"Sure," says he, "that's about as liquid as concrete." At that point I hung up the phone. I realized that this guy was just another salesman and that any further conversation with him would indeed be about as productive as talking to concrete.

If you are an investor, I would suggest you start (or continue) investing in real estate. The reason? Just do a quick scan of next Monday's Investor's Business Daily(IBD). (I get Monday's IBD on Saturday. It helps me foretell the future.)

Here's what Monday's IBD will tell you about your investments in stocks, bonds, mutual funds, futures etc. etc. etc.

Under IBD's headline "Another Week, Another Loss" you will learn that:

The New York Stock Exchange sank 1.6% last week

The Nasdaq dropped 1.5% last week

The S&P 500 fell 1.4% last week

Oil fell below $100 per barrel

Gold hit a 2-week low

Silver sank 3%

Treasury yields fell back below 3%.

I could go on and on with bad news from Wall Street -- and that's just from last week! No wonder they call the last 10 years the "lost decade" for investors. You can't make money with money anymore!

So, what are you supposed to do?

May I suggest you follow the "golden brick road" that many smart investors are now trodding and start buying investment property? This is the best time to be in the real estate market in many years because of all the short sales and bank foreclosures -- and things should continue looking up for the foreseeable future as more and more troubled homeowners face the loss of property due to the uncertainties of the current American economy. This enables you to purchase properties at very reasonable rates.

Remember this, people who lose homes still need a place to live. Consequently, the rental market is good right now and people are willing to pay well for nice rentals. Many of those being forced out of their homes are families, so buying larger single family homes makes a sound investment for you. If you don't want the headaches associated with managing property, turn it over to a reasonably priced professional property manager.

How much money can you make now in rental properties? I don't know, but some people enjoy much better returns on their real estate than they do in "traditional" investments. Look, let's say you've got a $50,000 CD paying you what, about 1.2% per month. That comes out to about $50 per month. Go purchase a single family short sale for $50,000 -- pay cash for it if you want -- and rent it for the going rate in your area. I'll bet dollars to donuts you will rent it for more than the $50 per month the bank is paying you on that CD!

Let's say you had that same $50,000 in Nasdaq stocks. You had a nice little gain going until last Friday. On Friday, Nasdaq fell 1.5%. All the gain that you had made for 2011 was lost. All of it! Six months of invested profits are now gone, gone, gone. Of course, you get to start all over again on Monday when the market opens -- unless it falls again, which is very likely given the situation in Europe and China.

Here's all I'm suggesting: If you're an investor it's time for you to give today's real estate opportunities a serious look. Don't look for the value of the property to go up like it did a few years ago. Those days are over. Instead, look for your investment to pay you rental income on a regular basis. Think of that rental income as your dividend and enjoy those profits.

-30-

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