Things are tough all over. Most experts believe the global economy will continue to slow down over the next few months. The Financial markets have seen a significant drop of 6-7% in May alone!!! Precious Metals, Crude Oil and Natural Gas are all down. In fact with the crisis in Europe and the global slowdown many people think we are seeing the beginning of a “Bear” market and another recession. Money has been flowing out of equities and into Bonds and Treasuries for months, and yields are at all-time lows. The 10 year Treasury yield is now 1.63%, 5 year CD’s are 1.7% and the S&P 500 yield is 2.15%. Not exactly a recipe for financial security for retirees or those nearing retirement.
With housing at a bottom everyone, including Warren Buffett, says Real Estate is where you should be right now.
You have many options as a Real Estate investor. You can buy rental property, tax, liens, Trust Deeds, flip properties, etc…. Basically you have to decide whether to be an “active” or “passive” investor. “Active” means finding, buying, rehabbing and then selling property or being a landlord. When you’re a landlord you have to deal with tenants, vacant property, vandalism and everything that goes along with that.
“Passive” investing gives you the opportunity to make money in Real Estate without ever having to do any of the above. By becoming a “Lender” you lend money to an experienced rehabber who purchases, rehabs and then sells the property with you receiving interest payments each month. As the Lender you receive a Promissory Note and a 1st lien Deed of Trust as security. Title and homeowners insurance is purchased by the borrower with you as the loss payee. Interest payments are deposited in your account each month, which provides great cash flow, and you don’t have to do a thing. Right now Trust Deeds are one of the best investment vehicles out there, especially for self-directed IRAs as the interest payments grow tax free. Like any IRA taxes are only paid as you draw down funds personally.
If you are tired of the roller coaster that is Wall Street, if you are looking for an alternative investment strategy, if you want to hold on to what you have AND SEE IT GROW, if you need extra cash flow each and every month, contact me immediately!