Predictions for 2012

The New Year is upon us, what will it hold in store for us?

In short Inflation, Migration, and a steady Housing glut.

2012 will not be as bleak as some economist and the followers of the 2012 countdown/ Aztec Mayan calendar have predicted.

The cycles of the past indicate that there will be a worsening in the stock market after about the first 5 months of the New Year.  This is based on the cycle of the Depression era.  The market is currently acting in the same way as it did during that time.

But of course we all know “this is the time to become a millionaire”; only if you know how to invest.  Investing in an IRA is always a good idea; your money is earning interest tax-free.  You do have to watch the fund that you are invested in, if it is a loser then you will have losses and eventually no retirement cushion.  Most funds follow the S & P so you could stand to earn a very small amount of interest on your money.

With the debt ceiling raised and the debt steadily rising we are headed for more inflation than we may be able to tolerate.  So if you have all your money in the US dollar, such as a savings account or money market account then you are invested in the dollar.  Translation, if you save $50 dollars today that $50 will be worth less in the inflated future.  So having money in investments, such a gold, silver, and yes real estate will help improve your bottom line.

With real estate there are two factors in the coming year which will help to prove an investment sound or unsound.  Migration patterns of our older Americans and increasing foreclosures.

So with inflation and real estate lowering in value, and credit still tight it means people will be trying to gain ground that may feel like it continually slipping away.

It does not have to be bleak.

With correct positioning in profitable markets and having a diverse portfolio the storm may feel like a sunshiny day in a tropical paradise versus a Tsunami.

So remember the New Year will be what you make of it.

Welcome to 2011: Sunday Morning Thoughts 2 January 2011

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With the New Year underway we are all looking more hopeful towards the immediate future.  This past holiday season showed signs of the return of consumer confidence.

All signs indicate we are still slowly emerging from our deep recession.  It is a slow process, but nonetheless we are emerging.  Consumerism from the holiday numbers looks like it is making a comeback, with a usage of cash instead of plastic.

Although the DOW almost made it to 12,000, it is now going into another cycle.

As for the housing market, even with the recent interest rate hike, will remain a flat line, then a sudden down turn and on to leveling out and slowly appreciating.  In the coming weeks you will hear and read more from many analyst about the impending double dip in the housing market.  Actually a good thing for investors; there’s always a silver/platinum lining to all clouds, buying now for homes, office space, and apartments deserves more than a light consideration.

Leveraging your money as a private lender can earn a nice return without the headaches of ownership, so if you don’t feel like owning an income property then make an income with being a private lender.

Retrospectively Looking Forward: Sunday Morning Thoughts 26 December 2010

The end of the year makes you think of what happened to time?  Didn’t we just do a New Year?  Almost 365 days have gone by and a lot has happened in this year which affects many of us.

We have witnessed healthcare, banking and Wall St Reform to lenders re-assessing foreclosure paperwork.  We have seen the real estate market go from a dive bomber decline to a flat line.

As far as investing goes, well the stock market has been surprising for some, investors have been realizing returns, and consumers are returning to consumerism.  All things look like we are returning to normal, but things are a little different.  Investors are not using all the traditional models of investing and consumers are not using the plastic money as much as they use to, paper takes precedence.

Interest rates are at an all time low.  Making it affordable to pick up housing deals but lenders have been so tight with credit that even a 750 credit score may not get a mortgage with favorable rates.

This has been the year of restructuring, rethinking, and basically a redo. Wow in school they always warned, that in life there aren’t any do-over’s, well, in some cases, yes.

We are living through a recession depression, not equal to the Great Depression, but still we are affected.  Unemployment, but a new job outlook is on the horizon; Employers are starting to hire again and set to do so even more in the coming New Year.

All in all, the New Year of 2011 shows promise, an increase in prosperity, and challenge.

The Lows and Highs of ROR: Sunday Morning Thoughts 05 December 2010

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As everyone has already seen the effects of buying high; in most cases buying when things are too high.  For example, the real estate industry in most markets is now appearing to suffer from an ever-increasing foreclosure surplus.  Foreclosures are still ongoing with more being added daily, except for the last two weeks in this month.  A short reprieve for Christmas and New Year’s holidays.

But the foreclosure tidal wave will not only resume in the New Year but will also see a higher amount from the McMansion sector.  Many of the suburban areas built expensively expansive homes in out lying areas.  Many of the McMansion homeowners realized the house and the commute have become too much for them.  So the new foreclosure landslide is the luxury market as more and more people decide to move closer to work.  This movement back to urban areas is creating an on slot of lower vacancy rates in areas where work is not as hard to find.

There exists a possibility of a shortage of rentals due to older more established homeowners.  Although a “shadow” market does exist of the very same established homeowners moving away from city areas preferring something with a slower pace and less congestion; Although conveniences has always been a consideration among younger and older alike.

Now we are in the buy low phase which increases rate of return.  Now is the time to start purchasing commercial property and more specifically, apartments.  People going through foreclosure are now displaced and looking for a place to rent.  The banks ever tightening their grip on credit is also contributing to people not being able to purchase homes.  The market of renters in middle-income areas are still a viable group.  They did not move to homes, or maybe they were foreclosed upon, but all in all they will need a place to live.