Hi, it’s Peter Aquart from American Wealth Builders.
Imagine if you had a crystal ball that could accurately predict the stock market. Would you invest in what it tells you?
If it was accurate, you probably would, right?
If you gazed into the crystal ball and it said to buy a specific stock or to sell a specific stock – and if that crystal ball had a track record of success – then you’d likely buy or sell according to what it said, right?
Well, most stock investors I know will tell you that they don’t have a crystal ball… but there is a type of investing that is as close to a crystal ball as you can get: that’s trend investing.
The theory is: if you know the trend, you can invest at the beginning of the trend and watch your investment grow.
There are many trends you can pay attention to. One that has always fascinated me is the trend that, during a recession, lipstick sales supposedly increase (because women like the affordable extravagance).
Other simple trends might include: gun stocks go up during periods of violence (because of increased gun sales), gold and silver investments increase in price when there’s uncertainty in the market, and hotel stocks increase when gas prices go down (because people travel more).
All of this makes sense, right? After all: when there’s a trend, it can pick up steam so if you get in at the bottom then the trend will increase and your investment will likely increase in value, too.
Disclaimer: whether this is true or not, I have no idea. I don’t pay attention to the stock market… but I’m just sharing what I’ve heard about trends.
So, if I don’t pay attention to the stock market, maybe you’re wondering why I’m bothering to tell you this at all.
Well, to make the connection that trend investing happens in real estate, too.
As a turnkey investor who acquires properties, puts a tenant in them and a management team in place, and then helps investors like you add these cash-flowing properties to your portfolio, it’s worth noting that we are investing “on trend”.
The trend is rentals.
When people ask me why I love turnkey investments, one of the reasons I give as an answer is that the need for rental properties aren’t going to go away.
Do you think they are? I don’t believe so.
#1. Rental Properties Are A Historic Reality
Rental properties have been around for thousands of years. Just last month, a 2,200 year old rental contract (carved in stone!) was discovered in Turkey.
Today, rental properties are prevalent in every major city.
#2. There’s A Need For Rental Properties In Every Market
Like anything else in a free, capitalist market (and even in many non-capitalist markets) rental properties are in demand. There is always a need for rental properties. Sure, some markets might need more rental properties and others might need less; some markets might need a certain kind of rental property while other markets might need a different kind… but every major market has them. Even in the high-end markets, there’s a need for rental properties – perhaps for a wealthy celebrity who needs a place to live for 6 months while filming nearby.
#3. There’s A Need For Rental Properties In Every Economy
You’d think that in amazing economies, more people would have money to buy homes so there’d be less need for rental properties, but this isn’t always the case: even when the economy is strong, some people still earn minimum wage, while others may have bad credit and cannot get a mortgage, while others prefer not to be tied down for so long. No matter what the reason, every economy has a requirement for rentals.
So, those are the main factors that support the existence and pervasiveness of rentals so far.
But there’s one other factor that I love…
#4. The Need For Rentals Will Likely Increase
At American Wealth Builders, we believe the need for rental properties will actually increase.
In the past, renters typically consisted of:
- Low-income earners.
- Young singles or newly married people who did not have enough for a down payment.
But now, the type of renters have increased:
- Low-income earners still make up a large part of the rental market… and with low-paying jobs on the rise (and high-paying jobs on the decline) there are more and more low-income earners.
- Young singles or new couples who do not have enough for a down payment – this is on the rise too, as more and more people are choosing not to get married or commit to a partner early (thus delaying the ability to combine incomes), plus – housing prices are rising out of reach of many people.
- Millennials, as a group, are typically not as interested in putting down roots with the purchase of a home, since this demographic is interested in travel, experiences, and not being tied down.
- Retired people, especially those who do not have enough money to retire with (and cannot rely on social security benefits) are increasingly selling their homes to extract the equity and then renting a more affordable and easier-to-maintain home.
- Mobile workers. We used to live in an age where someone worked at one job their entire lives. Today, people are changing jobs with much greater frequency, and jobs are now often requiring people to move. Or, people are choosing to move from one job to another, depending on the opportunity.
Today, there are so many people who are renting. The need for rental properties is higher than ever. And, I believe, this trend will continue this way for years to come as we’re just at the tip of the iceberg on some of these trends.
That means: if you want to invest in an emerging trend, then investing in rental properties is a powerful way to cash in on a huge trend. And there isn’t a faster, simpler way to invest than through a turnkey property, since they’re hands-off investments that are cash-flowing from day one.
Give our team a call and let’s help you take advantage of this trend inside your investment portfolio, IRA, or 401k.
Chief Operating Officer
American Wealth Builders
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