What’s your investinal fortitude?
August 16, 2011
Opportunities to invest your money come in many varieties. Some are safe, low-return situations, while other have more risk and afford greater return on the invested dollar. Some are stable over the long haul, while others can change immediately.
Stocks are a good example of the latter. There are many opportunities in the stock market, high or low risk, and each has the commensurate return. We’ve recently seen how volatile stocks can be with GM and the bottom falling out of its stock price. Real estate has dropped dramatically and is a daily headline in the news, but it has taken years for it to drop to half or one third of its peak value. Stocks can be reduced to a fraction of their peak value in a matter of hours.
Some investors choose gold, silver, or other such investments. While they have seen price volatility in the past, there seems to be stability and growth in that area now. How high will they go? That is anyone’s guess, and the guesses change with each article or opinion that you read.
Real estate affords a great variety of investment opportunities. You can buy a cash flow, a depreciable property, speculative property, etc., each with its own benefits and risk. Real estate prices have fallen over the past four years, but it is important to recognize that it took that long for the prices to fall where they have fallen to. The extent of the decline was startling, but it wasn’t immediate. In most cases, the recovery of real estate pricing is just a matter of time. Things will turn and the demand will be good.
Demand is always a driving force in investments. High demand, high price. While the financial crisis has limited the number of people who can buy right now, there is still a strong latent demand. The population has continued to increase while housing starts have been non-existent creating increased demand. In our beautiful region with the wonderful people and other amenities that make it so attractive, demand from people looking to relocate here will rise again in the future when they can structure their lives to be able to leave where they are at. That compounding factor makes our area an excellent place to invest in real estate with confidence.
Depending on the amount and objective of your investment capital, it is important to diversify your investment portfolio. Some investments provide cash flow, others create wealth. It is important to recognize what you wish to achieve with your money and make a plan to get it. Investing isn’t for the faint of heart unless you are getting 1 percent on your money in a safe harbor. If you are putting your money at risk to achieve substantial gains, you must have the investinal fortitude to stick it out. Real estate investment in Northern Nevada today can help calm your nerves while your money is so invested as prices are great and the upside full of potential.
There is always risk in investment. If you lose value with stocks you will have a piece of paper. If you lose value with gold you will at least have gold bars, coin, etc. If you lose value with real estate you have something, and they aren’t making any more of it. There are many types and opportunities in real estate, so you should work closely with your agent to find the right match for you. When you do, buy and go forth with confidence… you’ve made a good investment. No gut wrenching today buying real estate in Northern Nevada.
n Lisa Wetzel and Jim Valentine are real estate agents with Re/Max Realty Affiliates in Gardnerville. They are short sale and foreclosure specialists and certified distressed property experts. Contact them at firstname.lastname@example.org.