WHY PRIVATE REAL ESTATE?
Private real estate is an income-producing investment where wealthy investors store their wealth. Often portrayed as an alternative investment, private real estate - "bricks and mortar" - is more accurately characterized as a foundational investment because it is tangible and one of the most easily understood investments. People always need a place to live, and many choose or need to rent. As such, rents are paid and income above expenses is distributed to investors. More importantly, the returns from the income are realized. Realized income is the opposite of paper gains and the income - which is usually tax advantaged - can be used for any new investment or personal need. In addition, a property's value is indifferent to whether the stock market is up or down.
Add Wealth Creation & Income to your Portfolio
Over time, the input of labor, land and materials to real estate investments begins to cost more, and as a result, the cost to replace that real estate increases. Moreover, significant value can be created and appreciation gained through smart renovation or as a result of acquiring the asset at a discount to market value. It is important to target investments in geographies with built-in demand drivers, such as population growth due to internal migration, job creation and low taxation. To the extent we can marry population demand drivers with supply constraints such as a shortage of buildable topography, a restrictive zoning commission, or other similar barriers to entry, the ingredients for wealth creation as well as income are present. Remember, real wealth is patient money and the vast majority of millionaires achieved their millionaire status as a result of investing in real estate.