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How Alan Greenspan can jack up your Investing Risks A couple of months ago the Stock Market did a major overnight Swoon.... Former FED Chairman Greenspan uttered the "R" word - Recession * The Chinese stock market tanked while we were sleeping * The Dow Jones Average dropped like a stone 416 points * AND every other index around the world followed over the edge like so many lemmings Bottom line is $583 Billion in wealth evaporated in a single day - in the US alone, because of one retired government official saying one word. Despite this overnight meltdown, your investment advisors probably tell you that stocks and bonds are much more risky than direct Commercial Real Estate Investing. Try telling that to the people who lost half their net worth in the Dot-Com crash. I just smile and remember the benefits of being a "Greenspan-Proof" Real Estate Investor ... *You Count Your Profits on the Buy* You can use Excel to create a proforma that will tell you almost exactly what profit to expect ... before you even buy the property. You can pencil out your plan to improve the property, raise the rents, lower expenses and get a pretty good bead on the value of the property given the resulting increase in cash flow. *Monthly Cash Flow helps You Sleep Like a Baby* You get a check every month, no matter what happened in Alan Greenspan's latest press conference. That flow of cash comes from processes you can understand and predict. Rent minus expenses. AND you can raise the rents and lower the expenses to force appreciation of your property - that's on top of the income... cool. *Leverage Baby Leverage* You can buy $100 in property for $20 down and it doesn't even have to be your money. Just imagine going in to Merrill Lynch with $2000 from one of your investor friends and ask to buy $10,000 of stock. They flat out would not know how to respond. Yet you can raise $200K from friends and purchase a $1M piece of Commercial Real Estate in any city - any where in the country. *Save On Your Taxes* There is no other investment where you can get a deduction on your taxes - for year upon year - while your property continues to go up in value. Depreciation is the Real Estate Investor's secret weapon. Look at Mutual Funds for a contrast. There you can owe taxes even though the fund lost money in that year. Now that's safety for you. So when you are doing your due diligence and making the contacts that will bring a good piece of property into your portfolio, remember the unique benefits of Commercial Real Estate Investing and know you are eliminating some major risks to your wealth. Forget about Greenspan and how much the Dow Jones fell that day. Remember you depreciation, your leverage and your cash flow and put on a grin like the Cheshire Cat. Then lay yourself down to sleep at night, safe in the knowledge that your properties are protected from the overnight ravages of the brokers and pundits that roil the world's stock markets.
Article Source: http://www.realestateinvestmentarticles.net
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