One crisp fall Sunday afternoon under bright blue skies, my wife and I visited five homes up for sale. We remembered them by their street names: Big Acre, Blue Silo, Pontiac, Prairie Rose and Lamont. The lineup has a poetic ring to it, but the real music is the potential rates of return from owning them and renting them out.
This was the second weekend we went hunting. It’s been a fascinating experience so far, and what I’ve found tells me the housing recovery is not too far off, despite all the dire talk to the contrary. The investment implications are many and varied.
Being bullish on housing is a contrarian view. In a recent national survey, 37% of homeowners say they think buying a house is a “risky investment.” And 86% think prices will either stay flat or fall.
The Federal Reserve was supposed to protect the value of the U.S. dollar – at least that’s how it was originally sold to the public. We still don’t know why the dollar needed “protection”. It was solid for the longest time, except for the time when President Lincoln printed too many of them to pay for the War between the States, but those dollars came and went.
The constant fluctuations of the housing market can mean many things in terms of property investment, rental rates and the life of a landlord. We know, for instance, that there is a higher percentage of renters in the United States than there has been in quite sometime. But what we haven’t addressed is that there are also more landlords.
