If you really believe Armageddon is just around the next corner, you won’t worry much about real estate investing. But you might have two alternatives: (1) buy a bomb shelter and stock it with guns and canned food, or (2) buy a book.
The second option is cheaper, of course, so while I am not expecting cataclysmic events anytime soon, I got a copy of ”Theft of the American Dream” about our “financial crisis” and what to do about it.
You can get your own copy for $24.95 from iUniverse. But in the meantime, something that may surprise you about the thoughts of author J. F. Swartz, identified as an investment counselor with 30 years’ experience, is his optimism about real estate investments.
He predicts general chaos ahead, of course, due largely to the bankers and politicians who have “stolen our standard of living” mainly through creating so many billions of dollars by the Federal Reserve.
But he has some optimistic words for real estate investments, which he says can return up to 50% a year when “you buy right.” This got my attention, of course, so I share it with you.
In a section called “Investment Principles to Thrive By,” he outlines some matters that don’t stray too far from common sense such as investing only in things you understand.
But later in the book, he devotes less than two three pages (two and a half, really) to rental real estate.
He makes the point that the single-family housing market of late has not only not been good, it’s been “disastrous.” But that has created investment opportunities because while the overall market is bad, each property stands on its own merits. So the author’s best suggestion is to find properties that have cash flow opportunities.
Not exactly groundbreaking news, of course, but the writer urges investor’s to look at the bank inventory of foreclosed or threatened forecloses. That is admittedly a market of millions.
Then go to the smaller banks which still are making loans at these homes or even consider such government agencies as the FHA to help.
Then after buying, simply make improvements to upgrade the properties to their “potential, and profit accordingly,” the author writes.
Don’t flip, however, but instead look for properties to buy and hold.
Flipping sometimes works but not normally, he writes.
“Better to collect rents than to go after quick capital gains,” he writes.
If you have more time than most of us, look for conversions. That means changing a property’s use to upgrade it and sell it for a profit (not as easy as it sounds).
If you like to travel, don’t forget the foreign market, either.
After all, the principles outlined here (you will have to get a copy of the book itself to find out others, which I am neither advocating or urging…simply outlining) are universal. Besides, most countries share our inflated currency.
I don’t endorse any of this but I do have to point out that this book (and many others like it) do illustrate some good news for real estate. Whatever scenario you predict for the future, real estate investment can be a winner despite the clouds of doom that some see looming just ahead. ###