Whenever I get asked by anyone how to invest in property, I respond with a series of questions: • What are your financial aims? In other words what are you after? Are you seeking an income, capital or both? There is a big difference between wanting to retire in 2 years so you can live off your investment income and wanting to help your children with tuition expenses in 12 years. • Will you need to borrow money and how much risk are you willing to take? • Will you consider investing overseas, and if so, where will you invest – Europe, the Far East or the Middle East. • What level of risk are you willing to take? • What happens if you need your money back quickly? Remember, liquidity is a major problem in property investment. If you invest in the stocks and share market, you can pick up the phone and sell in minutes. That’s liquity. Just try doing that with property and you’ll see that it’s a completely different story. • What about your tax liability and what would happen if it all went wrong? • Do you want to invest in commercial or residential? Do you even know the difference? These are the type of questions you should be asking yourself before you dive in and invest in property. It’s very helpful to write down your reasons for wanting to invest in property. You can always revise your list if you change your mind about your investment motives. But I guarantee you won’t be sorry for spending a little time up front making the list. On the other hand, if you’re unable to come up with any motivating factors for investing, you’re also setting yourself up for failure. This may seem like a lot of work, but it’s a crucial part of the process if you want to succeed. Remember: buying property BEGINS with a well thought out plan for your exit strategy! You should also be aware of the intense marketing hype of many online estate agent sites; they often prey on gullible, uninformed individuals. Be careful not to fall for the hype regarding the off plan deals marketed in nearly every country. Media such as glossy overseas magazines that advertise second homes for sale as investments are often very misleading.Another word of caution – don’t be fooled or conned by the promises of “get rich quick” property schemes. Property is a long-term investment. It’s easy to lose sight of this as you hear any number of different, new and possibly more exciting property investment strategies that appear to be making money NOW. Years ago you could purchase reasonably-priced property, rent it out and make good money in a relatively short period of time. However, times have changed and this is no longer the case. Not all real estate agents will be upfront about this fact. Like many others, you may mistakenly assume that your real estate agent is determined to help you obtain the best possible return for your money. Unfortunately, this is often not the case. The main goal of real estate agents is to sell property – period. Do you think it is in their best interest to convince you to make long-term property investments? Definitely not! Media resources can also hamper your property investment opportunities by writing bad or good reports about property investments that simply aren’t true. Property-related journalists are being paid to write, not to conduct research about the real estate market or lucrative investment opportunities. Advertising is big business and journalists may be paid to write a scathing or glowing report about various overseas or local investments that is completely false. Hence, it’s best to ignore the majority of what you read in the magazines and conduct some solid market research on your own. After all, it’s your money so you want to invest it wisely! Fortunately, there are some reliable resources available to help you learn about current trends in the property market. Start by consulting one of the following websites before you invest in any of your hard-earned cash:Collierscre – One of the leading worldwide real estate consultanciesKnight Frank – Residential and commerical property professionalsThe Royal Institution of Chartered Surveyors – Leading source of information relating to construction, the environment, property and land Estates Gazette – Magazine offering detailed information about commercial property trends Also be sure to talk to local real estate agents as well as some reliable rental management companies. They can discuss some of the more successful local invesment property strategies. Don’t forget about members of your local business community and shop owners in your community. They can prove to be invaluable sources of information when it comes to local property invesmtent. If you establish clear investment targets, you can focus only on the relevant types of property. I don’t recommend choosing more than two property types if you’re an inexperienced property investor. Given the vast amount of possible investment properties, this small step can save you a lot of wasted hours. You should also limit the cities you’re considering to one or two. You can then determine the best and worst investment areas of a specific city by analyzing various factors such as crime and employment statistics. The bottom line is don’t rely on only the latest investment fads to determine where to invest your money. This can prove to be a very costly mistake, especially if you are new to property investment. Spend some time determining your motivating factors for investing, ask yourself several important questions and narrow your target area to one or two cities. These steps will greatly improve your chance of success. With a little planning and advice, you can develop a clear investment strategy and avoid the most common property investment mistake.
December 4th, 2009
posted in Property Investment
During the current economic climate, there are factors that entrepreneurs look at more closely when it comes to starting up a business. The “where” and “how much” factors become a bigger part of the decision, as one looks to trim any unnecessary cost factors. Gone are the days where if you were technology based, you’d set up in Silicon Valley or if you needed to network with business contacts – set up shop in New York. Ironically, thanks to modern day technology, you can set up in a much wider range of locations.Entrepreneurs look at factors like the ease of recruitment, and as a result – have looked into the central states of the US, such as Colorado, where the workforce is well educated, quality of life is good, and cost of living is a big step lower than on the coasts. With hopes up about stabilisation of the economy, this is a great opportunity for aspiring entrepreneurs and small business start ups alike to take things to the next level. Over the last few years, several angel groups and individual investors have started to set up shop in cities like St. Louis (such as the Arch Angel Investor Network), again bucking the general trends. On the Central Investment Network – entrepreneurs in the Central states of the US get another chance to connect with angel investors. Members can get their business ideas and plans out to hundreds of local investors – and since Central Investment Network is part of the Angel Investment Network, members can connect with thousands of other investors from around the world. In fact the network grows continuously, with branches in over 40 countries and investments occurring both on a local and international basis. Of course, the plans have to be well thought out and organised, as while entrepreneurs may have less competition, the investors are also more choosy. Still, there are signs that more successful angel investment strategies such as venture capital investments are occurring within the central states. While some venture capital backed companies have gone bankrupt this year in the U.S, almost all of them are California based, and none of them are in the states that the Central Investment Network covers – which includes Colorado, Kansas, Missouri, Montana, Utah & Wyoming.Find out more, by visiting http://www.centralinvestmentnetwork.com
December 4th, 2009
posted in Investment News
Central Banks are in all sorts of a pickle.
With overwhelming evidence that the global economy is slumping badly:
* UK Retail Sales see Worst Slump in 20 Years
* Business confidence in Germany is at lowest level in 2 years
* New Zealand’s central bank cutting interest rates saying slowing economic growth will curb inflation.
* Japanese exports decreasing YoY, and imports climbing on record Oil prices.
* US unemployment at 4-year highs
The knee jerk reaction by central banks is to man the printing presses and hit the accelerator. And whilst this medicine has worked well over the last 25 years, Central Banks are now hitting a brick wall that they haven’t encountered since pre-Keynesian 1930s.
Freshly minted fiat currency is falling into the hands of a crippled banking sector with little capital, ability or desire to carry out the multiplier effect and make loans to real people in the real economy. In a debt laden global economy with no reverse gear this headwind is possibly the biggest threat the Federal Reserve and its ilk aka the establishment have ever faced in carrying out monetary policy
Point #1 – Gold investors are well aware of the risks inherent in the current financial system.
The beauty of capitalism and the associated free movement of capital is that smaller more focused entities aka Hedge & Private Equity funds can and are rapidly moving into long held banking preserves.
* Direct lending to mid and small cap entities is now a well worn hedge fund territory.
* Extracting value through Shareholder activism.
* A much larger pool of capital available for short selling.
* Private Equity funds increase investment time horizons.
Highly secretive and operating out of non-transparent domiciles these entities are by and large out of the reach of the central banking system.
Point #2 – Hedge Funds and Private Equity Funds do not benefit from Fed handouts and would be better served by a currency that acts as a stable store of wealth – Gold!
The transfer of the financial system is akin to the explosion of information on the internet. The players that used to have a monopoly on information become less effective. There will be winners and there will be losers. But right now a bet on Gold Investments like Gold Stocks and Gold ETFs is a bet against the Establishment and the out-dated mega-banking system.
Slower growth will continue to cause problems for financials as bad debts soar, and as a result Gold investments will continue to propel higher in its multi-year Secular trend.
The above trend stretched too far technically over the last 3-months and there has had a rapid reversal over the last 2 weeks. This is a technical pullback only and the above fundamentals have not changed. There’s more to come in this fundamental story and Gold investments (we use GLD gold Exchange Traded Fund) and we could be getting close to another buying point for gold soon
Gold Investment GLD Fund Prices – $85 is strong support as a confluence of lateral support and the 50-week Moving Average converge. Its just a matter of time before we have another entry point to add to our positions and or make another profitable gold investment.
December 3rd, 2009
posted in Gold Investment
Throughout history, gold has been a highly valued substance. It’s unique properties and relative scarcity caused almost every world culture to use it as a form of money, as well as a way to “store” value. Although it has lost much of its importance as a form of currency, gold investments still provide a great way to protect your money and diversify a portfolio.
Over the past few years, gold prices have been steadily rising. There is a very good chance this trend will continue over the long-term, making it a good idea to put some money into gold investments now. Also, buying gold is a great way to hedge against other investments. Due to uncertainty in the stock market and the value of the US dollar, it’s a good idea to put 10-20% of your money into a hedge fund in order to protect yourself. Gold and silver have always been considered to be among the best forms of hedge investments because they have relatively stable values (due to very small changes in supply).
How to Invest in Gold
Before you buy gold, it’s a good idea to get the help of an investment consultant. This is especially true if you’ve never invested in gold before. He or she can help you determine the best moves to make based on your own personal financial goals and risk tolerance. If you already have a personal financial adviser, tell him or her that you’d like to use gold to hedge your portfolio. If he or she doesn’t have much experience dealing in gold investments you may want to find someone who does.
If you’re interested in profiting from the price movements of gold, buying gold bullion coins are an excellent option. The best choices are the American Eagle, the Canadian Maple Leaf, the Britannia, and the Australian Nugget coins. You can buy gold bullion coins from precious metal and coin dealers, both offline and online.
Before making a gold bullion purchase, always shop around for the best prices, as the markup on coins will vary from dealer to dealer. Also, do everything possible to make sure the dealer you’re buying from has been in business for awhile and has a good reputation. If possible preserve your gold coins in the original mint packaging and protect them from scratches to maximize resale value.
Gold bars are another gold investment option you may want to look into. Smaller bars are usually more expensive (per ounce) than large bars but are often easier to sell. In general, bars carry a higher price premium than coins. As with gold bullion coins, only buy and trade with reputable dealers.
December 1st, 2009
posted in Gold Investment
Do you remember your history lessons in school? Were you paying attention? You may recall lessons that discussed the weight of gold or the history of gold in the world. Gold has been used for purchasing, bartering and collecting throughout history. Gold has even been a hedge against inflation and helps to preserve and protect future earnings of Americans.
Today, we can purchase, trade or make a gold investment in a variety of ways. Gold comes generally in two forms, also called bullion, these forms are coins or bars made of gold. With trading, most investors trade in gold futures on the market. Gold Investments are often made in refining or mining companies.
If you take a look at history, you will begin to notice that gold was very helpful all through the changing times. It provided a safe avenue during times when the world’s economy was unstable. For major gold investors, gold can improve a portfolio and decrease the amount of risk.
There is a variety of avenues when it comes to gold investing. The options for invest are; gold coins, bars, statement accounts, accumulative plans, mine shares and mutual funds.
Possibly the most popular avenue of gold investment is in coins and bars. There are different sizes and weights available to invest in. Some of the weights include 1 gram, 1 kilobar and the international bar. But that’s not all.
An investment in gold bars is one way to produce cost efficient methods of investing in gold. This is because broker commissions are minimal for selling and purchasing gold bars. Gold coins are as popular among small and medium investors. The reason for this is that in the issuing country, gold coins are considered legal tender and guaranteed for their face value even through economic changes.
Some of the leading gold coins include:
*The American eagle- It is available in weights of 1/10, ¼, ½ and 1 troy ounce
*Canadian Maple Leaf- It is available in weights of 1/10, ¼, ½ and 1 troy ounce
*South African Kruggerand- It is available in weights of 1/10, ¼, ½, and 1 troy ounce
*English Britannia- It is available in weights of 1/10, ¼, ½ and 1 troy ounce
*Australian Kangaroo- It is available in weights of 1/20, 1/10, ¼, ½ and 1 troy ounce
*Chinese Panda- It is available in weights of 1/20, 1/10, ¼, ½ and 1 troy ounce
*Austrian Philharmonic- It is available in weights of 1/10, ¼ and 1 troy ounce
*Mexican Centenario Family- It is available in the following; 2, 2.5, 5, 10, 20 and 50 pesos.
*Mexican Onza- It is available in weights of, ¼, ½ and 1 troy ounce
As you see above, gold coins are a popular form of gold investing and good planning for the future. Gold will be a good investment through changing times because it will keep its value.
Summary:
Gold Investing has been the best form of investment throughout history. Today, gold can be purchased in two types of bullion. You can also invest in “gold statement accounts”, “accumulation plans”, “mining shares”, “options” and “mutual funds”.
Gold investing assures that your future is secure.
December 1st, 2009
posted in Gold Investment
Newer Entries »
