Real estate investors come from all walks of life and in all ages; they are part-timers, full-timers, wholesalers and fix & flippers if their goals are more in the shorter term. There’s nothing wrong with a short term business plan, but we’re all getting older, and we should remember that the reasons many of our customers are long term rental investors are really quite lucrative and secure.
The biggest fear of those in the baby boomer generation is that they’ll run out of money in retirement. Sure, some will have jobs that they can continue, and retirement doesn’t mean what it used to anymore. Others will be unable to stay on in their life careers, and they get reminded of how things may go every time they’re greeted going into Walmart.
If you’re active in wholesaling or fix & flip, you’re probably well aware of the criteria your long term investors use to decide whether to take your deals. You know that they want a certain ROI and cash flow, and the neighborhoods in which they like to buy. If you’re recruiting newbie rental investors, you may even be pitching to them with the benefits in this article. If not, maybe you should refresh your knowledge and do some recruiting to build your business.
Daily Market Gyrations & Emotions
With real estate, you’re not watching CNBC and getting daily market quotes, scary news, or watching your investment drop 3% in a single day’s trading. Sometimes it becomes too much, and you place exit trades when you shouldn’t, looking back the next week and regretting getting out of that investment. With real estate, you can’t call your broker and sell in five minutes; it takes a lot longer, so you don’t do it.
Inflation Isn’t as Big of a Threat
Stock and bond portfolios suffer when inflation rises, and when returns are as low as they are these days, you can actually see a negative return. When the price of materials and labor rise, it costs more to build a home, so prices hold or rise on average. When new homes cost more, existing homes cost more, so your investment isn’t shrinking.
Cash Flow Better than Dividends
Generally, rental positive cash flows are immensely higher than dividends on stocks or returns from bonds that are relatively secure. Double-digit returns are the norm, and that’s far better than the average top stock and bond portfolios.
You Have Some Control of ROI
Better management practices, property improvements, and better marketing can increase cash flow. You have some control over these factors, while you have no control over the management of companies in which you own stock.
Super Tax Advantages
From depreciation to 1031 Exchanges, real estate offers unique tax breaks that aren’t available to stock and bond investors.
Real estate investors come from all walks of life and in all ages; they are part-timers, full-timers, wholesalers and fix & flippers if their goals are more in the shorter term. There’s nothing wrong with a short term business plan, but we’re all getting older, and we should remember that the reasons many of our customers are long term rental investors are really quite lucrative and secure.
The biggest fear of those in the baby boomer generation is that they’ll run out of money in retirement. Sure, some will have jobs that they can continue, and retirement doesn’t mean what it used to anymore. Others will be unable to stay on in their life careers, and they get reminded of how things may go every time they’re greeted going into Walmart.
If you’re active in wholesaling or fix & flip, you’re probably well aware of the criteria your long term investors use to decide whether to take your deals. You know that they want a certain ROI and cash flow, and the neighborhoods in which they like to buy. If you’re recruiting newbie rental investors, you may even be pitching to them with the benefits in this article. If not, maybe you should refresh your knowledge and do some recruiting to build your business.
Daily Market Gyrations & Emotions
With real estate, you’re not watching CNBC and getting daily market quotes, scary news, or watching your investment drop 3% in a single day’s trading. Sometimes it becomes too much, and you place exit trades when you shouldn’t, looking back the next week and regretting getting out of that investment. With real estate, you can’t call your broker and sell in five minutes; it takes a lot longer, so you don’t do it.
Inflation Isn’t as Big of a Threat
Stock and bond portfolios suffer when inflation rises, and when returns are as low as they are these days, you can actually see a negative return. When the price of materials and labor rise, it costs more to build a home, so prices hold or rise on average. When new homes cost more, existing homes cost more, so your investment isn’t shrinking.
Cash Flow Better than Dividends
Generally, rental positive cash flows are immensely higher than dividends on stocks or returns from bonds that are relatively secure. Double-digit returns are the norm, and that’s far better than the average top stock and bond portfolios.
You Have Some Control of ROI
Better management practices, property improvements, and better marketing can increase cash flow. You have some control over these factors, while you have no control over the management of companies in which you own stock.
Super Tax Advantages
From depreciation to 1031 Exchanges, real estate offers unique tax breaks that aren’t available to stock and bond investors.