What makes commercial real estate a better investment than the stock market
Investing in the stock market can be a great way to build wealth over time, but it also comes with risk. Losing money in the stock market is like a game of musical chairs. You never know when the music will stop, and if you're not able to exit the market quickly, you could lose a lot of your wealth.
On the other hand, commercial real estate may offer the best returns with the least amount of volatility. Unlike residential real estate, commercial real estate is not based on the value of neighboring properties. Instead, the value is tied to the net operating income, which could make it more predictable and stable.
During the 2007-2009 financial crisis, the mortgage default rate for houses was 5-6%, contributing to a massive meltdown. In contrast, the mortgage default rate for multifamily apartment complexes was only 3.5%. Commercial real estate is based on a business model rather than just the property's value.
When most people think of commercial real estate, they tend to think of retail or office spaces, but in reality, commercial real estate space may include any property with four or more units. This can consist of apartment complexes, self-storage facilities, and more.
In conclusion, investing in commercial real estate may achieve better returns with lower volatility, making it a great option for retirement savings, legacy wealth, and responsible stewardship.
Investment platforms for investors with limited funds
Creating a fund catering to micro-investors can be lengthy and costly, which could take up to $500,000. The process is rigorous, requiring approval from the SEC. However, existing funds, such as Fundrise, are already available for micro-investors, allowing investors to invest as little as $500 in real estate-backed investments.
Aside from Fundrise, crowdfunding sites are available for everyday investors. A quick search on Google could yield results for crowdfunding sites catering to investors with as little as $1,000 to invest. These sites allow investors to invest in various properties, including single-family homes, mortgages, and apartment complexes.
Another option for investors looking to invest in real estate with limited funds is to invest through a self-directed IRA or 401k. A self-directed IRA allows investors to invest retirement funds in non-traditional assets such as real estate. By doing so, investors may enjoy the same tax advantages and continue to grow their retirement funds through real estate investments.
While creating a fund that caters to micro-investors can be costly and time-consuming, alternative investment options are available for investors with limited funds. By exploring crowdfunding sites and self-directed IRAs, investors can still invest in real estate and enjoy the potential returns that come with it. In conclusion, investing in real estate could be viable for investors looking to diversify portfolios and generate passive income.
The feasibility and demand of investing in storage units
Do you feel like you need more space to store all your stuff? Well, you're not alone. In fact, according to recent statistics, around 11.2% of American households have a storage unit means that for every 10 houses, you're likely to see atleast one that’s renting a storage unit.
So what does this mean for the self-storage industry? It means there could be a growing demand for these facilities. This has led many investors and developers to jump on the bandwagon and build storage facilities.
In fact, before commencing construction, feasibility studies are carried out to evaluate the potential for success and demand in a particular area. For instance, a company invested $14 million to construct three storage facilities in Orlando, Florida, which offered 400,000 square feet of storage space. Despite the high cost, the company identified a demand for such facilities. It outsourced the management to a third-party property management company.
In conclusion, as populations grow and people accumulate more belongings, the demand for storage units will likely keep increasing. The self-storage industry appears to be a growing trend that shows no signs of slowing down. With the rising demand for storage units, more investors and developers will likely jump on board and build new facilities.
Investing with Purpose: Understanding its Meaning and Impact on the World
For entrepreneurs seeking to make a positive change in the world, investing with purpose is at the core of their investments. For example, they might create a meaningful global impact by partnering with nonprofit organizations and funding diverse projects through donor-advised funds.
Your entrepreneurial journey is driven by a higher purpose beyond material wealth. Through collaborations with the right business partners and nonprofit organizations, you may actively serve local communities, provide housing for numerous families, and operate on-site nonprofits to support individuals in need. Additionally, you may extend your support to those affected by war by donating bulletproof vests and blankets to protect children in war zones, providing daily meals to children, and rescuing hundreds of individuals daily behind enemy lines in Ukraine.
So, remember that to invest with purpose, it’s imperative to invest with the right people who may help you touch the lives of hundreds of thousands of people worldwide.
The significance of aligning your values with your investments
Investing is a complex decision to make. It's about choosing where to put your money and what values and principles you align yourself with. For some investors, supporting specific charities or religious organizations may not align with their beliefs. They may prefer to invest in companies or funds that don't have any ties to a particular cause.
Steven Libman shared his experience with investors who were hesitant to invest because of the nonprofits his company supported. Instead of changing its values to cater to these potential investors, he explained that he would rather stay true to his mission and values.
For purpose-driven entrepreneurs, prioritizing social impact alongside financial returns is more important. They believe that their investments should generate gains that benefit society as a whole and should reflect in the nonprofits they support.
Steven also emphasizes the importance of education and transparency in investing. Some investors may find it worthwhile to join groups or platforms where they can access information about a company's portfolio, returns, and team. The platforms they join might also be an educational tool for those new to real estate investing, providing resources and frequent Q&A sessions to help investors make informed decisions by allowing investors to ask questions, connect with other investors, and better understand a company's values and investment strategies.
Overall, an investment company's approach highlights the importance of aligning one's values with their investments. For investors looking to invest in real estate while also supporting social impact, finding the right people and company to invest with could make or break their career. So for those new to investing, educational events, groups, and platforms may provide a useful starting point for making informed investment decisions.
