How Commercial Real Estate Investing Limits Your Risks

Greenspan and the "R" Word

A couple of months ago the Stock Market did a major overnight Swoon....

The "R" word - "Recession" came out of Alan Greenspan's mouth

* Asian markets held an overnight meltdown

* The Dow Jones Average dropped like a stone 416 points

* AND every other stock index worldwide tripped and fell just as hard

In the US alone over $583 Billion went POOF because one ex-government employee's single remark.

The same pundits who wring their hands at such market swings tell their investors that direct Commercial Real Estate Investing is "High Risk". That's another "R" word getting plenty of play lately - Risk. Tell that to people who rode Enron and so many other stocks down to zero.

It is a great reminder of why you have to invest a portion of your portfolio in Real Estate and NOT stocks. Let's count the ways.

*You Know Your Profit When You 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.

It is a numbers game where you get to look at ALL the numbers you need to be successful. Purchase prices, rents, estimates for costs of improvements. You can even calculate what you can sell for just by knowing a little about the market and the cash flow your property is producing.

*Predictable Cash Flow Lets You Rest Easy*

You get a check every month, no matter what happened in Alan Greenspan's latest press conference.

The cash flow depends on things you can know about and are pretty darn fixed - rent, mortgage and fixed expenses. And many of them you can improve to drive appreciation of the underlying property IN ADDITION TO your income.

*Leverage Like No Other Investment*

You can purchase a $100,000 building for $20,000 down and - get this - it doesn't even need to be your cash.

Imagine asking your broker to sell you $1000 in stocks for $200 in cash ... they would just shake their heads and laugh.

Yet with $200K of your investor's money, you can buy a $1M apartment complex in any State in the Country - any day of the year.

*Save Taxes with Depreciation*

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 just remember all the benefits of Commercial Real Estate Investing as you take on the tasks of looking for the right property for your portfolio. Your patient due diligence will be well worth it.

Forget the former Head of the FED and the market's drop.

Remember you depreciation, your leverage and your cash flow and put on a grin like the Cheshire Cat.

And at night, when you are ready for bed, you can forget about the market's ups and downs and sleep well knowing your assets are in real estate.

Article Source: http://www.articlemonk.com

Thinking about investing money in the stock market any time soon? - Think again. Learn how Commercial Property Investment can increase your Cash Flow and Safety.
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