Today's KCM Blog Post "Long Term Real Estate Investors Are In For A Bonanza"
Long Term Real Estate Investors Are In For A Bonanza
More millionaires were created as a result of the Great Depression than at any time in the nation’s history. Noted rich-guy John D. Rockefeller has said, “The way to make money is to BUY when blood is in the streets.” Another noted rich-guy, Warren Buffet, believes you should “be fearful when others are greedy and to be greedy only when others are fearful.” Huge success comes to those who see confusion as an opportunity. Today, there is a significant opportunity.
With interest rates at historic lows and home values where they are (the Housing Affordability Index is as favorable as it has ever been) I have one question… “Why hasn’t everyone jumped into the market?” Housing is still one of the most basic of needs (food, clothing, and SHELTER).
But moreover, real estate is the way to building a financial fortune. Today, rents collected can cover mortgage payments, often creating a positive cash flow. That is a critical determinant to the strategy; buy something, have the rent make the payment, and wait for the market to improve. Ten years from now you will be glad you did. This is no “get rich quick” scheme. It is a long term commitment.
I truly believe that to eat up all this inventory we are going to have to entice more than the people who want to own their own slice of the American Dream into the market. We need to bring back the entrepreneur to real estate… the investor who wants to “buy and hold” real estate for a long-term investment. Investors often buy multiple units/homes and find long term returns that outpace the stock market.
