VIEWS: 6 PAGES: 3 CATEGORY: Strategy POSTED ON: 11/14/2012
Diversification of your investment portfolio is one of the keys to success in the real estate business. It's important that you pay heed to the following saying, "Never put all of your eggs in one basket".
Investment Portfolio Diversification – For A Successful Real Estate Business Cover By: Curt Cloyd – Director Personal Wealth Academy, LLC Investment Portfolio Diversification - For A Successful Real Estate Business By: Curt Cloyd – Director Personal Wealth Academy, LLC One of the keys to be successful in the real estate business is Investment Portfolio Diversification. It's important that you pay heed to the following saying, "Never put all of your eggs in one basket". The reason why it is better to spread your income and investments around is because it reduces risks and ensures stable returns. Real estate investing can be lucrative. But the investment strategies associated with real estate investing have risks associated with it. You are subject to various market conditions such as demand, construction costs, property costs, funding, etc. At any given point of time, your profit margins may go down or go up. Cost of certain properties may fall severely because of excess speculation. With that said, here are a couple of real estate investment models that I strongly recommend that you invest in... 1. Real Estate Investment Trusts (REIT) A real estate investment trust is a security listed on a major exchange that invests in real estate directly through property or mortgages. Just like how you'd purchase shares of a company, you purchase some shares from the trust. These trusts are likely to invest in multiple areas such as commercial, rental, etc. Investing in trusts specializing in many such areas ensures that you enjoy good returns with minimal risks. There's an interesting article at BarbaraFriedBergPersonalFinance.com that talks about real estate investment trusts. You may want to read that. The reason REIT's are much more effective is because the upfront investment costs are minimal. You don't have to invest thousands of dollars like you'd with physical real estate investment strategies such as wholesale, fix and flips, rental, etc. You can start building up your retirement portfolio with just a couple of hundred dollars. 2. Single family homes If you're considering fix and flips or rental, I strongly recommend that you invest in single family homes over other types of homes (in good locations). The reason why we recommend single family homes is because the demand for single family homes is going to be high always. And you can actually find a lot of motivated sellers of single family homes who are behind their mortgage payment. You can actually come in and close these deals within a couple of days if you know what you are doing. Investing in single family homes is one of the best ways to build up your real estate empire and create LASTING wealth. But for most real estate investors, it's ONLY a dream because they lack the cash flow they need to make such investments. Generating consistent cash flow is as important as diversification when it comes to real estate investing. There are some effective business models that you can use to build a successful cash flow business. I strongly encourage you to learn more about these business models by clicking on the following link - http://taxsalephd.com/page1.php
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