Real Property vs. Market Investments

January 9, 2014

Guest article by David Hoyle:

After spending more than 20 years on Wall Street as a partner in a major investment firm, I now focus on providing a cost effective way for others to invest in the real property market through self-directed investment programs. I believe there is no better way to diversify capital market risks, better-known as stock market risks, than through the introduction of tax-deferred investments in income-producing assets into an individual investor’s portfolio.

I hope that as you and I look into our collective crystal balls of the future, we recognize the following:

1. Stocks are making new highs, despite an expectation on the part of a majority of investors, but that growth will remain low and fragile in the coming year.
2. Bonds, which have been made expensive through the Federal Reserve Bank’s “Quantitative Easing” program, will now become a source of increasing volatility and risk as the FED scales back its buying program.

At a time when equity and bond portfolios are becoming more correlated (i.e. they tend to behave the same and are therefore less diversifying and more risky), real estate investments represent a true source of diversification and a source of very attractive returns. While individual stocks may offer double digit returns in the future, seldom do general index linked assets offer multiple consecutive years of double-digit returns.

As uncertainty creeps into the financial assets marketplace, an increasing number of investors will look to real property investments. Problematically, they will see opportunities, but will be confronted with increasing liquidity issues. Banks will not lend.

This is where a great opportunity for self-directed IRAs exists. Direct portfolio investment, joint ventures, equity participation lending, and other transactions within a self-directed investment framework all look likely to be on the upswing for 2014 and beyond.

Together with NuView, we at Old Florida Properties look forward to helping you find profitable opportunities.

David is the founder and managing broker of Old Florida Properties LLC, a licensed real estate brokerage firm located in downtown Orlando. You can contact David by phone at 407-529-4621, or you can visit his website at www.old-fl.com for more information.