Real Estate Basics
Diane Kennedy is the author of the Rich Dad book, "Loopholes of the Rich: How the Rich Legally Make More Money and Pay Less Tax", has a website dedicated to the ever changing tax laws and how to take advantage of them. She is bullish on real estate as an investment. Here are excerpts from her latest e-mail newsletter:Part of the fun of being "ahead of the curve" is that when the mass-market is looking left, you're looking right.
Real estate is no different. The papers are absolutely chock full of doom-and-gloom, it's a bad investment, the market is still crashing, etc. Which is fine with me. That means more deals are out there.
How many of you remember a time, just about 20 years ago now, that the real estate market was flying? What stopped in then was spiraling interest rates. I remember reading stories about interest rates at 22, 23, even 24% and people abandoning their homes because they couldn't keep up with the payments. The market crashed, hard, in the late 80's. Some said it would never recover. But it did. Fast-forward to today, and repeat the cycle. Only this time, while appreciation has slowed or stopped in a few areas, we're not facing double-digit interest rates, either.
Personally, if you think you missed the boat on real estate, I would disagree. In fact, I'd be more inclined to say there is a new boat heading your way. Now is a great time to prepare. Educate yourself and build up your cash reserves. Real estate often costs a bit more than you think to get into, even if you are investing with other people's money.
In the week's What's Hot, I want to share with you some of the fundamentals of real estate investing. These are terms and ideas you need to become very familiar with, if you want to be ready to board the next real estate ship.
- The Cash-on-Cash Return: what it is and why it matters
- Depreciation is your friend: maximize your deduction!
- My property is worth too much! What can I do?
* To subscribe to her e-mail newsletter updates go to http://www.TaxLoopholes.com/us
posted by SFResidence.com @ 7:43 AM
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