I only know of one type of investment that can give you the returns you deserve. The answer is real estate. If you buy and hold for a long period of time, you will do well. I graduated as a starving artist from theatre school with zero investment knowledge. I learned how to invest over time by reading, doing and speaking to other investors. I decided to purchase a property after graduating. Enough of the analysis paralysis syndrome. It’s time to come off the bleachers and change my life I thought to myself.
I put about $12k into my first property, seven years later, I spit out over $200k. That’s a 50.7% return on your money. If you want an enjoyable retirement without financial concerns then I personally believe real estate long term investing is the key. Alot of people have done really well in this industry. If you do a search, the majority of people created their wealth through real estate or they are using real estate to hold it.
Wealth is not created over night, nor it’s created in the final inning of a baseball game. It is created by advance planning, hard work, by educating yourself in investing and the most important, persistency. If you don’t have interest in personal finance, then that’s fine as well, the governement should be able to assist.
The market in April 2022 has shifted downward. It has created a lot of uncertainty for everyone. Inflation in my area has hit nearly 7% says CBC News. Gas prices are hovering at around $2 a liter these days. How can you defend your family against a financial shift like this? Investing. There are many types of investments out there. Real estate is my specialty. So I can be biased.
I believe that the best thing with real estate unlike stocks or Bitcoin is that you don’t have to spend a lot of time timing the market as it is quite labour intensive.
In real estate, it’s more of time in the market versus timin’ the market. If done properly, you set it and leave it. If you do a search, you’ll quickly find that real estate market graphs has increased over time. Time will be on your side.
How long of a period you need to hold you might ask? Some of my competitors are offering ten year holds, but I believe five years is the sweet spot. It is not too long, and it will have enough time to smoothen out any market fluctuations in order to take advantage of the appreciation.
When people tell me that five years is too long, it brings me back to the beginning paragragh that wealth is not created over night. This is not a get quick rich scheme. Real wealth is created with patience. The longer you hold, the better the off the owners will become. That’s why it’s important to invest early, to invest now.
Although some sophisticated investors may have several strategies all happening at once such as several short term flip projects, lending deals etc.., the long term holds is what will yield them with the largest returns.
Investing in real estate on your own is great because you have control of all aspects of your investment. You control the type of property you want to buy, you control the rents, you control who will live in your unit, you find your own lender, you control what to spend etc.. however doing it on your own may not be for everyone.
Another consideration is that you may want to invest in real estate investment groups. Some of the benefits are as follow:
1) Small amount of capital needed.
2) Risk is reduced as capital entry level is lower.
3) It’s hands off and passive. The active partners do all the work.
4) The active partners are normally well diversed in this field.
Some people tell me that they need strong cashflowing investments. I agree, but in my area, the strong cashflow deals are becoming increasingly difficult to find in ideal cities. The rents cannot cover the mortgage payments. In order to have a stronger cashflow, a larger downpayment is required. Otherwise, a solution for higher cashflow with a limited downpayment is to consider investing in less stable areas such as smaller cities. Higher risk equates to higher returns.
More investors will be switching their investing strategies around. The industry is changing. They are holding for the long term in order to see a better return at exit and sacrifice the cashflow in the interim. Do some research to get a second opinion.
For investment groups in my area that have access to large capital, they can put a lot in the downpayment to see a property cashflow better. But why would they invest so much capital into one property when they can purchase many? The risk will be more diversified if the group invests in several properties in case one deal fails. Thus, we may come back to the same delima where the large payout at exit is the preferred strategy. The long term hold.
I’m sure one can find better casflowing properties in areas outside of mine. Cashflowing deals in my area with a small downpayment seems to be the thing of the past. But if you are truly interested in real estate and would like to consider taking part in an exciting new project we have, check out the video below and use the form underneath to contact me directly.
Please seek professional legal advice prior to entering into any investments. The information presented in this blog is for educational and reference purposes only.