2020: Investing in Real Estate

One of the oldest businesses on Earth, real estate has played a crucial role in building wealth for individuals throughout the millennia. What makes this form of investing so interesting is that unlike stocks, real estate’s high level of illiquidity serves to protect landlords during times of financial or social uncertainty. Another unique aspect of real estate investment is the multitude of ways one can profit from it. By assessing the pros and cons of investing in real estate during 2020, we hope to help you decide whether investing in real estate is right for you during this time. 

When comparing stocks to real estate, the two are at the complete opposite ends of the spectrum. For example, stocks are highly liquid while real estate is highly illiquid. Consequently, selling real estate takes longer than selling a stock. However, real estate can offer much more protection than investing in the market as you can expect to get paid by your tenants.

Regardless of the financial benefits that come along with monthly cash flow, the setback real estate investors face can sometimes be more than its worth. Specifically, latent defects are an issue encountered by many landlords. These are hidden deficiencies within a building that can sometimes be of major consequence. Not only can these defects negatively affect the value of a property once discovered, but it can also cost landlords tens of thousands of dollars out of pocket. We along with many other real estate professionals suggest you get your prospective properties inspected before closing to prevent latent defects from becoming an issue. 

Due to growing humanitarian sentiment in the United States, many landlords may also suffer from government policies or incorporative tenants. In New York City, lawmakers have proposed suspending rent payments for 90 days to help those affected by the coronavirus. Furthermore, the state of California along with many others have temporarily banned evictions. For those unfamiliar with the eviction process, it can take months to successfully remove a tenant from a landlord’s property and comes at no small expense. These current reforms are among many other pieces of legislation, which have curtailed the power that a landlord has over their tenants. While legislation of this sort does incredible justice to everyday tenants, it proves a complex moral enigma for landowners to consider in times of financial distress.

As a real estate investor, it is also crucial to be cognizant of how to make money in multiple ways from a rental. Typically, property will appreciate 2% on average every year. When it comes time to sell your property, you can expect to sell it for more than you paid for if the real estate market is cooperating. In addition to appreciation, you make money as your tenants pay off your mortgage through equity. As you build up equity, you will have the option to take it out of the house and use it to pursue more deals. Despite needing a hands-on approach, real estate investing offers a plethora of ways to amass a fortune.

©2020 Hedge Fund Z










Important Disclosures: Investing in the financial markets can involve considerable risk, including loss of principal. Past performance is not necessarily an indication of future performance.  Actual clients may achieve results materially different from the results portrayed.  All material is for informational and educational purposes only and is not investment advice and is not meant to suggest that any securities are suitable investments for any particular investor.  All information reflects our own actions, beliefs, and processes for purely informational purposes. HEDGE FUND Z LLC IS A FINANCIAL BLOG FOR THE SOLE PURPOSE OF EDUCATION.  HFZ does not represent themselves as acting in the position of an investment advisor or investment manager for funds that are not under their direct control and fiduciary responsibility. 


Third party quotes and information may not be representative of the experience of HFZ customers and do not represent a guarantee of future performance or success. Many of the results displayed on our website were achieved using leverage, such as 2x or 3x leveraged ETF's or equity options 


The information included at HFZ and HFZ writing, research, and updates is prepared for educational purposes and is not a solicitation, or an offer to buy or sell any security or use any particular system.  Information is based on historical research using data believed to be reliable, but there is no guarantee as to its accuracy. HFZ does not represent themselves as acting in the position of an investment adviser or investment manager for funds that are not under their direct control and fiduciary responsibility. HFZ will not provide you with personally tailored advice concerning the nature, potential, value or suitability of any particular security, portfolio or securities, transaction, investment strategy or other matter.  


No information, nor any opinion expressed on the Site or in the Services, shall constitute a solicitation or an offer to buy or sell any securities mentioned therein.  The information presented on the Site and in the Services has been prepared without regard to any particular investor's investment objectives, financial situation, needs, capacity, and trading ability or experience. Accordingly, you should not act on any information on the Site or in the Services without obtaining specific advice from your financial advisors and should not rely on information herein as the basis for your trading and/or investment decisions.  HFZ cannot claim or represent that any of our Services are suitable for you. 


By your use of the Site and Services, you're agreeing that you bear responsibility for your own investment research, trades, and investment decisions. Only you can decide whether or not a trade is right for you and you agree to be liable for any trades you initiate at your brokerage using research and/or tools that we provide. If you ignore our advice to do independent research and choose instead to trade solely on information, analysis, alerts or opinions found in our Service or website, you have made a conscious, willing, free, and personal decision to do so. You also agree that HFZ, its directors, its employees, subsidiaries, affiliates, and its agents will not be liable for any investment decision, trade made or action taken by you and others based on news, information, opinion, or any other material published through our Site and Services.  

For additional important risks, disclosures, and information, please visit www.hedgefund-z.com/terms-and-conditions.