Investing in Stocks vs Real Estate

[BocaBum99]

This seminar has a positive outlook and outcome - therefore a fee must be charged. The drive-by media is "free" it forces a steady diet of doom and gloom on us through thousands of newspapers, TV, cable, books - humans seem to need to feel guilty about something to feel good about themselves (I said that) - go figure.

Anyway, I suspect that 95% of the folks paying money fail at this scheme and the 5% that do succeed go on to sell books/courses to the 95% that fail.

It's not just this real estate scheme - the stock market has the same track record of failures but folks pay big money to learn how to fail there too.

Oh well, enough doom and gloom from me today - see how easy it is.

P.S.

BB all the best. Let us know how it goes.

P.P.S.
The DJIA has averaged 13.3% since 1933 (Before that the stock market was really a futures market with 5% cash - any wonder why the huge crash back then - thanks US government)

Maui has averaged 9% for 35 years.

My suggestion to those who want to invest in real estate is to buy something you can use and enjoy it. If you want fast action try Pork Bellies - I know it puts a little kick in me.

It's hard to outdo the DJIA over a long period of time. Just buy DIA (Diamond trust which is an artificial stock that mimics the DJIA)

On Oct 9, 2006 the DIA was $118.62 a share - this very second it is $140.52 - (Throw in 4% dividends for the year) that's a 22.5% increase in 12 months. You can margin 50% of your portfolio and in essence double that to 45% in 12 months.

It is a VERY liquid market and in 3 days you can have your cash in your hand. If you want fast action with all kinds of protection then just leverage (margin account) your savings to the eyeball and you will do much better over any period of time.

That's what I do - I just by DIA and never sell it. I don't margin much - just for some excitement. Now compare this to wheeling and dealing and see which is going to do better for you over 20 - 40 years of investing.

I can not overemphasize what I just said:

In the past 12 months my net worth is up 22.5% - what's in your wallet?

Perry,

You made the call on Oct 7, 2007 to buy and hold DIA. On Oct 8, 2007, it was at 140.52.

At this time on Dec 17, 2008, it is at 89.57. Congratulations, your call resulted in a loss of 36.26% for anyone who listened to you on that day.

Your net worth is down 18.13% just based on that call.

 

[CaliDave]

Boca -- you are assuming he didn't margin his DIA's,which could have resulted in a much bigger loss.

 

[Vacation Dude]

I actually think DIA is now a good buy, but who the heck really knows anything for sure.

I also feel Maui is a terrible buy now or last year as I am sure prices are really depressed now and for the next few years.

 

[BocaBum99]

I actually think DIA is now a good buy, but who the heck really knows anything for sure.

I also feel Maui is a terrible buy now or last year as I am sure prices are really depressed now and for the next few years.

I agree that DIA is a buy NOW. But, it wasn't a buy on Oct 8, 2007.

I am not sure if the Lahaina Tower 3br oceanfront units are a terrible buy if you can pick one up for less than $10k. Not sure if you can. But, if it presented itself, I'd have a hard time saying "no." Yes, $2000+ for maintenance fees are steep. But, such a unit would probably rent even in this depressed market for more than the MF. And, once travel rebounds in Hawaii, which is will at some point in the future, it will be a LOT more.

Actually, I'd have a hard time seeing Marriott waive ROFR on such a deal, even today.

 

[BocaBum99]

I actually think DIA is now a good buy, but who the heck really knows anything for sure.

I also feel Maui is a terrible buy now or last year as I am sure prices are really depressed now and for the next few years.

Ooops, this Maui reference is related to general real estate. I'm not familar with Maui real estate market, but it's probably depressed like everything else is, especially a condo hotel which is valued based on expectations for its net rental income.

 

[Vacation Dude]

Ooops, this Maui reference is related to general real estate. I'm not familar with Maui real estate market, but it's probably depressed like everything else is, especially a condo hotel which is valued based on expectations for its net rental income.

I hear condo-hotels are next to impossible to sell, thus the prices are crashing. Or is that the sound of the waves hitting the sand in Maui and Florida?

 

[Mydogs2big]

I tend to believe anything that will always have a market and is not easily replaced, ie; land, raw materials, water, electricity, food, is always a buy just when no one else wants anything to do with it.

Of course, it can be difficult for even the smart investor to pull the trigger and buy, because fear is very powerful. It also makes it hard for the smart investor to sell when everyone wants his investment (that greed emotion)

People who saved some money waiting for a good time to invest should do well in the present economic cycle.

Even if they didn't save, they may do well using other people's money. I started buying houses in the early 90's and bought almost exclusively owner contracts. Over the last several years I had to limit buying to outer areas (remote) but it looks like there will be deals to be had in town again soon.