Why Investors Should Look At Real Estate
You've probably seen the morning reports on the stock market's performance for the past eight days. Between the debt crisis and the childish performance from Congress, word of a big drop in consumer spending, bad employment figures, soverign debt problems in Europe and all the rest, stocks had their longest losing streak since the start of the 2008 credit crisis. Investors are worried about federal spending cuts and the apparent stall in the economic recovery.
Because of this, the Dow Jones Industrial Average dropped 265.87 points on Tuesday, August 2nd. The eight day losing streak for Wall Street has been the worst since October, 2008 -- that is when Lehman Brothers collapsed and is considered by many to be the peak of the U.S. credit crisis.
The Standard & Poor's 500 dropped over 32 points on Tuesday. For S&P, this is the worst 7-day streak of losses since October 2008.
The Nasdaq composite dropped over 75 points, a 2.8% drop in overall value in one day.
Quite possibly, whatever gains you feel like you have made in the stock market since the first of this year may very well have been lost in the last week or so. Check your statement for July and see how you did.
I know some people who did pretty well in July with their investments. They invested in real estate during the last year or two. No, they did not flip any property. They rented them to solid tenants who paid their rent on time.
I am not an investment advisor, but those who read this blog know that I have been suggesting for some years that the stock market has become a "roller coaster ride" and that long-term real estate investments will prove to be the best -- and perhaps the only investment -- that will be profitable over the years. Did you know that most of the great fortunes made in America included a healthy portfolio of real estate investments? It's true!
Yes, there was a real estate bubble and some people are in dire financial situations because they became overextended. In many cases, these were people who were "flipping" real estate and trying to make money on the difference between the purchase price and the upswing in real estate values in the 2003-2008 period. Many of these people got burned.
Others, however, who invested for the long term have done very, very well indeed. Rather than trying to make a quick hit by flipping, these investors took the longer view. They found good tenants and rented their properties for a nice profit each month. Like every business, they probably found that real estate rentals have some ups and downs, but in the long run most of these people have made out very well -- certainly better than stock market investors given the same time period.
My understanding from various property managers with whom I am acquainted is that right now is a great time to own investment property because the demand for nice, clean single family homes and apartments is very high. A lot of people are losing their homes to foreclosure and short sales. Despite this, those people still need a place to live and have reasonable incomes to cover the rental costs. Consequently, this is a good time to own rental property.
If you have had it with Wall Street, why not talk to a real estate agent who knows a thing or two about property as an investment? This might be just the approach to help you recover that lost nest egg.
-30-
Because of this, the Dow Jones Industrial Average dropped 265.87 points on Tuesday, August 2nd. The eight day losing streak for Wall Street has been the worst since October, 2008 -- that is when Lehman Brothers collapsed and is considered by many to be the peak of the U.S. credit crisis.
The Standard & Poor's 500 dropped over 32 points on Tuesday. For S&P, this is the worst 7-day streak of losses since October 2008.
The Nasdaq composite dropped over 75 points, a 2.8% drop in overall value in one day.
Quite possibly, whatever gains you feel like you have made in the stock market since the first of this year may very well have been lost in the last week or so. Check your statement for July and see how you did.
I know some people who did pretty well in July with their investments. They invested in real estate during the last year or two. No, they did not flip any property. They rented them to solid tenants who paid their rent on time.
I am not an investment advisor, but those who read this blog know that I have been suggesting for some years that the stock market has become a "roller coaster ride" and that long-term real estate investments will prove to be the best -- and perhaps the only investment -- that will be profitable over the years. Did you know that most of the great fortunes made in America included a healthy portfolio of real estate investments? It's true!
Yes, there was a real estate bubble and some people are in dire financial situations because they became overextended. In many cases, these were people who were "flipping" real estate and trying to make money on the difference between the purchase price and the upswing in real estate values in the 2003-2008 period. Many of these people got burned.
Others, however, who invested for the long term have done very, very well indeed. Rather than trying to make a quick hit by flipping, these investors took the longer view. They found good tenants and rented their properties for a nice profit each month. Like every business, they probably found that real estate rentals have some ups and downs, but in the long run most of these people have made out very well -- certainly better than stock market investors given the same time period.
My understanding from various property managers with whom I am acquainted is that right now is a great time to own investment property because the demand for nice, clean single family homes and apartments is very high. A lot of people are losing their homes to foreclosure and short sales. Despite this, those people still need a place to live and have reasonable incomes to cover the rental costs. Consequently, this is a good time to own rental property.
If you have had it with Wall Street, why not talk to a real estate agent who knows a thing or two about property as an investment? This might be just the approach to help you recover that lost nest egg.
-30-
posted by Terry Ward at 5:27 AM
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