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Real Estate Investments – Alternative Investing
By Vic Hurlstorm | June 24, 2009
I want you to consider capital investments differently. Traditionally the generic recomendation has been “invest for the long term growth” and then you are told to place your investment capital in blue chip stocks or some other retail market offering.
This is what I dislike about that idea. Most investors are rather passive in their investing activity. By passive I mean that investors place their bets and then hold, kind of like a farmer planting a crop and then waiting for it to bear fruit.
Here is the rub with that action when investing. A farmer plants the crop somewhat speculatively, he tills, plants, waters and fertilizes and then lets providence take care of the rest. Yet at certain times his planting is vulnerable. Too much rain or not enough or a tornado just before maturity can wipe him out. But it’s more often that his investment will bear fruit and get harvested without a serious incident. So he bets every year on normalcy.
Mutual funds do not grow like a crop. First of all, it may or may not grow. It is more likely that it will surge in one direction and then in the opposite direction on a daily basis. Speculating this way on your retirement portfolio just doesn’t add up for a passive investor. It certainly would for a day trader because the trader can change his options as the market fluctuates. A passive investor can not. His or her business is somewhere else.
In addition, when investing in a market priced asset you are buying retail. You are buying the final harvest not the seed. So there is no built in leverage securing an increase. That kind of “Let’s try this” approach just doesn’t make sense when your retirement is in the balance.
Let’s look at alternative investing scenario. If you curious enough there are plenty of professional well-heeled real estate investors that run their occupation like a business. Here is how you can partner with them for secure growth of your investment capital.
There are many types of investments where you can buy wholesale like a farmer buying seed and expect a continued growth as a gardner would because it is built into the contract.
Investing in tax deeds, a swing loan or a mortgage might be one example. Buyers of paper never buy at face value (retail) they buy at a discount in order to ensure their yield. First position paper is usually leaning against an alternative asset (real estate) that is worth at least twenty percent more than the face value of the contract, so the worst that can happen is that you get your investment capital back without gain.
Even if the real estate values decline you are holding paper that is at least backed by its retail value. What normally happens is that the mortgagee pays on the loan and then refinances or moves and you get paid off – of course, all the while, getting a yield on your principle investment.
There are no wild swings in value therefore growing your wealth like a gardner and leveraging the expertise of a real esatate pro can provide you with consistent growth of your capital alternative without the volatility. This makes much more sense to me than buying into mutual funds where they could be worth less that what you paid for them the day after. At least you know whats on contract upon maturity.
There are many other capital investments where you can get up front leverage, a consistent yield and where you are protected on the downside if something goes wrong.
Please consider looking into various other investment options by going to Capital Investments Alternative and looking over what’s there.
If you are a real estate investor this is also where you can get that money to close those deals.
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