February 29, 2020
Whether planning for retirement, saving for your kids college, or earning residual income, you need an investment strategy that fits (1) your budget, (2) your risk tolerance, (3) your investment style, and (4) your long-term goals.
In 2007, approximately two-thirds of American adults had money in the stock market. However, with the Great Recession in our rear view mirrors and this week’s market crash, you may be thinking about real estate. It can be low risk, yield better returns, and offer greater diversification. True, it does require more effort – you must (1) assess the market, (2) consider the right property, (3) invest a large sum up front, (4) make a long term financial commitment, (5) evaluate numerous lifestyle and financial decisions including whether this is a property that provides a roof over your head or a ‘passive’ rental income. To get a sense of the Marin County RE market, you can see the market trends HERE. If you'd like to consider properties, I'm happy to talk!
Some investment firms are forecasting dramatically lower returns in 2020 and beyond. It makes sense if your company benefits include matching or catch-up contributions, but investing in the stock market independently can be unpredictable, as we have found this week.
While comparing the returns of real estate and the stock market is an apples-to-oranges comparison—we do see that real estate has outperformed the stock market approximately two to one since 2000, earning 10.71% annually versus 5.43% for stocks. With this sharp contrast in return on investment, some leverage real estate investments by acquiring rental properties. They benefit from the appreciation of the property, and the 8% to 12% passive rental income, less expenses.
#tracycurtis #marinrealestate #coldwellbankerrealty #home #marincounty