The PERFECT hedge for more potential housing depreciation

Most everyone in America has seen the headlines, news stories, and commentators who continue to proclaim real estate as the single worst investment in any assest class.

I tend to disagree........

The fact of real estate that brings me to this conclusion is simply this.....YOU have FULL control of the price you pay for any property.  Unlike stocks which must be purchased ( or shorted ) at the price at that moment in time, real estate is not a market that works on a predetermined price.  Let me explain it in this example;

Let's say you have $200,000 to invest and you are looking at buying some IBM for instance.  If the stock in trading at 135 a share.....you pay 135 or don't get it.  On the other hand lets say you see a home offered at $135,000 and you want to offer less.............you can!  What other assest class has as much opportunity as real estate?  Answer, none.

Back to my point of how to hedge, I offer this very simple yet effective idea.

If you beleive the news media and coverage that housing "MAY" go down further after already correcting in some areas over 50%, then just place offers at that mark.  Using the illustration above, if you are concerned that housing may go down another 10% and you don't want to take the risk of MAYBE losing on paper 10% from your purchase, place a bid for the property 10% below the current apprasial of the property!  Downside risk is now controlled and hedged for you by YOU!  You can offer any amount below the offering price, whether it be 10, 20, or even 30% below the apprasial.  The only thing that can happen is your offer is rejected, countered, or ACCEPTED!  WOW!  Try doing that with stock....impossible.

Real estate investing for cashflow is a fantastic alternitive to traditional paper assests such as stocks, bonds, commodities, and mutual funds. 

As always consult the advice of your local professional team to discuss your objectives and risk tollerance. 

Bottomline is this........the current real estate market's heavy correction is granting seasoned investors with some of the most incredible opportunites of our generation.  And unfortunatly only a few will take advantage of this.

DJB Realty, LLC caters to investors looking at properties and business for cashflow. Give us a call today to discuss the possiblities of assisting your goals and objectives in your portfolio.

Have a great day!