Why NOW is the right time for Investing in Apartments

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You may be asking, “Why would anyone start investing in apartments now? The residential market is so hot, we can barely find enough projects as it is!” The answer lies in those very statements.

We all know that real estate investing is cyclical. (Right? You do know that, don’t you? If you don’t, you need to start reviewing history, otherwise, you may loose everything you’ve built up these last few years!) Because of these known cycles, we always need to be planning for and anticipating the next phase, and investing in apartments is ours. Because of the inevitable nature of real estate’s up’s and down’s, we can – and should – plan our next steps. Investing in apartments is our next step.

The main reasons for my shift over the next 6-12 months are these:

  1. The residential rehab market will continue to tighten, with supply drying up. This makes it more difficult to compete.
  2. More and more competition from ‘newbie’ investors, those that are fresh out of ‘real estate boot camps’ and willing to pay way more than I am for a property (this is their inexperience).
  3. More and more people, when faced with the looming ‘market correction’ (what a phrase, huh: ‘Correction’) and the loss of jobs/hours, will need to downsize from houses into apartments.
  4. The baby-boomers are also downsizing, and will need to lower their overhead. By investing in apartments, we’ll be more prepared for this shift in economic lifestyle. And we’ll be able to ride this wave for the next 8-12 years, as this segment of our population goes through this shift.
  5. Cash flow. I’ll paraphrase a quote from Harry Helmsley: “I always liked the idea that a group of people would pool their money together to pay off the mortgage on my building.” Yeah, this sounds good to me.

Is investing in apartments tough? Not really. It depends on your approach. Some investors I know have amassed a a huge portfolio: two-thousand units up to five- & six- thousand units. These are BIG operations for a small group of people to manage. But this also presents an amazing opportunity to have safety.  Here’s why: It’s tough to buy the hundred-plus unit complexes that can actually cashflow while they pay for on-site management, with a $100,000 retirement account. However, you can partner with people that have the same amount of money, along with a person who is responsible for putting this syndication together. There’s safety in numbers, right?

Over the coming months, I’m going to write more about this shift in our biz, the benefits of investing in apartments, potential returns, and some things to look out for within the syndications. I’m so excited to share this with all of you!

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Trusts: An Investor’s MOST Powerful Tool!

Trusts are my favorite real estate investing tool, with many reasons to use them. Once you begin using Trusts in your real estate investing business, you’ll have ‘aha’ moments fairly often.

Learn How To Use Trusts at DiscreetInvestors.com/blog

Like life before your spouse or children, once you ‘get’ the Trust concept, you can’t ever imagine your life without them. Even you kids will be glad you started using them!

4 Secrets to Building Trust For ALL Real Estate Investors

For me, Trust is a simple idea: Do The Right Thing. Some people might find it tough to always do the right thing… especially when money is involved! For Real Estate Investors, the building and maintaining of Trust must be as consistent as the rising of the sun… Each and every day.

Trust The Sunrise and Sunset Everyday www.DiscreetInvestors.com/blog/

Do it right all the time and you’ve got people begging to do business with you.  Screw up even a little, and you’ll spend more time and energy trying to rebuild Trust, or paying for it in other ways. This isn’t only about Real Estate Investing – this goes for every relationship you have.

Assets Vs. Investments: How To Tell The Difference

Last weekend, I had a great conversation about investments with some friends. They finally realized that there is a big distinction between assets & investments. While they’d never thought about those differences before, it occurred to me that most people haven’t thought about them either.  I’m always surprised when somebody justifies a purchase with the term, “It’s an investment”.

Assets & Investments are like Apples & Oranges! Learn more at www.DiscreetInvestors.com/blog/assets-vs-investments/
“Oh, I buy expensive watches. They’ll be worth more in 20 years” a new friend said to me. “Buy a classic car – it’ll hold it’s value” was something I’ve heard before. Or, “I’m buying and holding on to great musical equipment like microphones, because good gear is always going to be good gear” was another comment. These bright, clever, and driven people claimed that all were good investments. But they hadn’t thought about it from the correct vantage point.  If they had, they’d see apples and oranges…

Conservative? How 2 or 3 Could Change It All…

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While vacationing in Skaneateles, NY with my family last month, I was chatting with my cousin about the return his financial planner has been getting for him.  When he said “5%-8%” I immediately thought, “Yup. That’s what EVERYONE says when I ask about their planner and the return they usually get for their clients.” He used the phrase, “It’s a conservative approach”. I’ve heard it before. It’s what most people think and do: Put your money with the planner, let it sit for 20 or 30 years, then retire, right??  Not so fast…