Realtors for Investors

I think this time will go down as one of the best times to have invested in income real estate!  An investment property will generate rents & can operate like the dividend on a stock.  However, I can’t go and paint my stock certificate or upgrade it if its not paying rent (or a dividend).  Right now the market is slow and Cash buyers can get investment income properties cheaper.  When the market recovers, as all cycles do, investors will have received a decent return on their cash while it was generating rents & then a “bonus” return by the price of the building going up.  This understanding of the multiple facets of investing in real estate are what make it fun & a time tested alternative to the stock market.  The team of professional real estate agents at Legacy Real Estate work with cash buyers in finding them great, low hassle properties in safe neighborhoods. 

As of Friday, October 10, 2008 - The Dow Jones Industrial Average (DJIA) is down 40.3% since October 9, 2007.  This was showcased in an excellent front page article in The Wall Street Journal on Friday October 10, 2008.  In fact seeing that article motivated me to lead a Free 60 minute Seminar on “Smart Places to put your cash in this scary and confusing time.”  I am hosting the first one at Legacy Real Estate offices - 800 Bethlehem Pike, Erdenheim, PA 19038.  The seating is limited so if you are interested - please call 215.836.8000 to reserve your spot.

In the last 100 years, there have been 3 major bear cycles.  The Great Depression lasted for 13 years from 1929-1942.  The second one lasted 16 years from 1966-1982.  This one started in 2000 and who knows when it will end.  What many people don’t see is that a 40% drop in the DJIA will now take an 80% increase to get back to 0%.  There is a new base and that base is now what has to rise by gains at a rate of double the loss just to get back to the same old base.

The reliable time tested alternative to the stock market is rental/income real estate.  Rental income properties don’t have the volatility of the stock market.  Even if the value of the property drops, the return based on rental income doesn’t.  People can use cash, self-directed IRA’s, 401Ks and othe vehicles to buy specific real estate that can generate a 6-15% return.  Think of it like buying a stock for the dividend that it pays out. 

That’s what rental income properties provide.  Except there is more reliability in receiving rents than receiving a dividend right now….  Then, when the price of the property goes up, there’s an even higher return.  this is why rental income properties are a reliable time tested alternative and the smart place to put your cash in this scary and confusing time.