PRLog (Press Release) - Mar 16, 2009 -
It’s no accident that 85% of all wealthy Americans built their fortunes with real estate investments. But you know what? You shouldn’t take that first sentence at face value. Ask yourself the obvious question. Why is real estate a better investment than stocks, bonds, or mutual funds? Any discriminating investor who is tired of getting his/her portfolio led to the daily slaughter by Wall Street chicanery should have that question answered.
There’s a lot of misunderstanding, misdirection and bloviation when it comes to comparing different asset classes but Jason Hartman and Platinum Properties Investor Network (PPIN) have synthesized the basic differences between property investing and everything else down into easily digestible bites of information that can be understood by people even without a background in real estate. Furthermore, Mr. Hartman has taken his 20+ years of experience building a small fortune in the industry and put together a comprehensive training package called The Complete Solution For Real Estate Investors™. No matter what your age or level of expertise, we can teach you how to create your own wealth through the application of these strategies. For access to our free information, please go to www.JasonHartman.com.
But let’s get back to the investing dilemma. Why is real estate different? The answer goes to the very nature of property investing. Real estate is a multi-dimensional asset while other conventional methods of investing are limited to one dimension. These differences are intrinsic. You can’t change them any more than you can change the size of your foot or the distance between your eyes. Yes, actually you could change those things with radical surgery but let’s try not to be quite so literal.
For example, your stock investments are one dimensional. You buy low and hope to sell high. Maybe it pays you a small dividend every once in a while, pay taxes on them, then sell it and get hit with the capital gains tax. Throw in the Enrons and Bailout Baby CEOs on Wall Street and you begin to realize why you are the proud owner of the incredible shrinking portfolio.
It doesn’t have to be like that.
At Platinum Properties Investor Network, we emphasize income producing property (residential rentals) as the finest investment vehicle available and we have history on our side to prove it. Down through the years, real estate has proven itself time and again to be the premium asset if you want to create life-changing wealth. The multi-dimensional nature has a lot to do with that. With real estate it’s not all about buying low and selling high. It might surprise you to learn that with the Platinum Properties methodology any appreciation that happens during the time you’re holding the property is just icing on the cake. Other dimensions are much more powerful. Here are the Three Major Dimensions of the Real Estate Asset.
1. Shortage of the asset: Last time we checked they are not making any more of planet Earth. What we have is all there is. No new cards are going to be added to the deck until we begin colonizing the moon or Mars. Every corner of our globe has been mapped and catalogued. Keep that thought in mind while you shift gears slightly to ponder the 2.5 billion new people joining the world economy over the next decade, courtesy of China and India. What do we have? Limited asset supply. Huge demand on the way. Contrast this to the conveyor belt of companies that arrive on the stock market scene with a splash, sell a few stocks, then fade into oblivion. Anything that can vanish overnight (Enron), taking people’s pension and savings with it should never be called an asset in the first place.
2. Your mortgage is a major asset: Many people have trouble wrapping their mind around this idea. The mortgage you hold can never be duplicated due to the ravaging effects of inflation. Every single owner of that property that comes after you will not be able to get as good of a deal because his future dollar will be worth less than you present day dollar. He will have to pay more for the right to take out a loan. Debt is historically cheap right now. Stock up while you can. In five or ten years you will wish you had.
3. Cash flow in the rental market: We just discussed how you have locked in the purchase price of your income property with your mortgage. Now you turn around and rent that property to a tenant, who will pay off your mortgage through monthly rents. What else happens over time? Rents go up but your price to buy in remains the same. The bank puts up the money to buy the asset. Your tenant pays off the asset. You own it in the end. Beautiful.
Real estate has many more dimensions, such as the fact it is the MOST favored tax investment, but these three should be enough for you to see the power it has over any other form of investing.
