A lot of folks that I talk to don’t understand what happened. Why was there so much money available to lend to people who wouldn’t have even qualified for a loan a few years back? “No income, no problem” was the motto at several lenders. The answer is easily traceable to the bright people down on Wall Street. Some of the clever folks over there realized that they could sell the mortgage debt from the high risk loans to publicly traded companies. This enabled the high risk of these questionable loans to be hedged by shorting these companies with derivatives. This safety net created a huge amount of money to become available for even more loans, creating a sort of snowball effect. Everyone became a real estate investor. People who lived in areas that had seen high appreciation rates were pulling second mortgages to 80 or 90 percent of their homes value and buying new homes for the sole purpose of renting them, then flipping for a profit in a year or two… Speculation became so bad in the Albuquerque area that some builders began the practice of refusing to sell to investors who had no intention of living in the properties. So here we are a year or two later and guess what, the plan didn’t work so well. Values are down, foreclosures are up. Good people are being tossed out of their homes because they couldn’t afford them in the first place.
And what about the hedging thing? All of the big banks, who held high risk paper are fine I suppose? Well, not quite. Seems like many of these big loan companies are dieing like flies. And some are getting assistance from the Feds, as in your tax dollars at work. Sort of reminds me of a few years back when the tax payer had to bail out to Savings & Loan industry. Smart corporate types always seem to find new ways to get rich on the back of the tax payers of this country.
As angry as this may make you, there is a silver lining to this cloud. Something that you could actually profit from. A few people are starting to talk about the great buying opportunity that is emerging in the markets right now. Prices are beginning to rebound in some markets. We here at the Land Investor are in this camp. Now is a great time to buy as long as you have a medium to long term time frame for you money. Don’t let the media hype deceive you, they are notoriously wrong about most everything, especially investment. Maybe you are ready for a larger home and you can afford to keep your current home as a rental. Or maybe you just want to pick up a fixer upper and rent it out, ride the appreciatioon over the next few years. And of course, don’t forget our favorite option in Real Estate Investing - vacant land. Stable, care free, and low stress! Whatever you desire is, take advantage of the current depressed values created by the bozo’s on Wall Street and you will thank yourself in a few years.
Keep an eye on that location for lots of information on what’s going on in Rio Rancho and why is represents such an amazing opportunity for investors. There will be a lot more info available soon!
While we at The Land Investor are trying to convince you that investment in vacant land is a great alternative to having a bunch of cash in the equities markets, we will certainly admit that many of the concepts practiced by successful stock investors are useful in real estate investment. One of those useful concepts is that of the contrarian investor. Warren Buffett has a reputation for being such an investor and seems to have done pretty well by it. Basically it means buy when everyone else is selling and sell when everyone else is buying. The theory behind it is simple greed and fear. People in general are slow to react to financial decisions. Buy the time most people have a strong enough fear factor to sell assets, the bottom of a cyclical swing is usually near by, the perfect time for the smart long term investor to step in. We believe such a time is at hand now for the real estate market. Stories like this one, full of gloomy ideas about the “real estate bubble” help confirm this way of thinking. Don’t let the gloomsters convince you it’s the end of society and time to put your money under the bed. Step up and find an affordable, low stress investment in real estate. You will thank yourself in a few years when you have a nice gain on it!
Part of our plan here at The Land Investor blog and site is to gather information useful for you in your effort to invest in vacant land. The following link - buyingsellingahome.suite101.com
talks about the importance of having a plan. Good sound advice. The site also contains a lot more useful information regarding investment in real estate, enjoy!
Welcome to the Land Investor blog. This blog and it’s companion site landinvestor.us have been created for two reasons. First we would like to help you understand the benefits of owning vacant land as a safe investment. In addition to understanding the benefits, we will provide detailed information on the process of buying vacant land in various types of accounts, including IRA’s and other self directed plans. Our second main focus is to provide you with timely information on opportunities to purchase land in the Albuquerque area. We believe that for many investors, vacant land ownership represents a much lower stress alternative to investing in the securiites markets. So sign up for our subscription service and bookmark the blog and web site. We promise, no spam, no scams, just great information on wealth building through real estate.
