Long Term Investment Tips For Stacking Profits
With stocks, bonds, and any number of liquid investments that can be sold at the drop of a dime, many people look towards real estate as the anchoring foundation to balance their portfolios. Even in an age of economic instability, real estate is still a very secure investment for building wealth, both long and short term.
The question is how do you choose the best property for future returns when searching for a long term investment? What are some basic strategies one can implement into their search in order to narrow the odds of buying a complete dud and maintaining a secure investment? One answer still holds true in any and every sector of the business world: location, location, location! For every action there is a reaction, and the reaction of certain factors will help you to choose the best location to reap the best returns. So what are a few factors that could stimulate a population boom and be visible well before it has taken place?
Ethnicity – With immigration, not breeding, being the fastest gateway for population in America, look towards the demographics of particular areas to find out which ethnicities are populating where. With strong cultural ties most ethnicities prefer populating within the same general location for that sole purpose. Determining these regions could give you a vast edge long before a particularly popular area is filled up. Buy and hold investments there, whether commercial or residential, will yield great returns for a very long time.
Water – I’m sure everyone’s heard the phrase “Buy land, God’s not making anymore of it.” Well that goes 10 fold for water. My grandmother and grandfather bought 2 ½ acres of lakefront property in Virginia during the late 60’s for $7,500. Over the next 30 years they would clear the land themselves and build up the majority of the entire home by themselves (my grandfather passing in the mid 80’s and my grandmother, a big time worker bee, would finish the rest by herself). When all was said and done she had invested in total around $55,000 over that 30 year period (and yes they even raised the walls of the house themselves with the help of some friends to do it). Though a buy and hold was never even on their mind when they first purchased the land, she turned around in 2004 and sold the house for over $450,000 to move to Texas. Waterfront property is gold. Just make sure you are weary of the areas you buy it in (flooding, hurricane, and the difficulties of insurance for those areas).
Big Business – Yes, there are certain businesses that will greatly stimulate a given area. Such businesses as Hewlett Packard and Dell are huge assets to a city or town. Not only do they greatly contribute to the employment factor around them, but their taxes for that area a huge benefit towards the establishment of better roads and other beautifying features. Most people point the finger at Wal-Mart Supercenters whenever they enter a given area as raising the crime rate. However, did you know that their warehouses and distribution centers, usually erected on back roads of small towns, creates a huge surge of income for these small towns to not only enhance their roads, but also greatly increase all of their public service budgets and stimulating future growth. The key is to figure out which businesses stimulate growth and look towards the areas they are moving into. One thing you might want to keep up to date on is if a particular business is leaving an area you are already invested in, and determine its impending effects on your investment.
With so many edges available to the insightful investor, creating a portfolio of long term investment properties will surely provide you with an unending stream of income. Remember, location is extremely important, but knowing everything going on in that location is the key to your future success.