6/13/10: Determining ROI – Balancing Risk and Reward
What’s a reasonable return on investment in today’s market? As you might expect, the answer is, “It depends!” Every investor must accept risk in order to attain reward. Even doing nothing is a risk with its own reward. The obvious goal is to achieve maximum reward with minimum risk. Duh. But what are the risks and how do you assess them? What are the potential returns? What’s about the not-so-obvious risks? And what’s reasonable to expect in today’s economy? Tough questions!
Balancing in our chairs behind The Real Estate Guys™ golden microphones (actually, they’re black with smelly foam that prevents our P’s from popping too profusely), to talk through all of these perplexities are:
- Your Host and mental gymnast, Robert Helms
- Co-host and floor tumbler, Russell Gray
- Chief spotter, the Godfather of Real Estate, Bob Helms
Real estate investing is as much an art as it is a science. There are so many different markets, sub-markets, product types and deal structures to choose from. Beyond that, there are variations in economic conditions, seller motivations, tax laws, interest rates and on and on and on. The types of returns which can be attained in a real estate investment range from bankruptcy (on the VERY negative side) to infinite returns (profit on nothing invested). We like the latter better, don’t you?
Recognizing that real estate investing is “non-traditional” when compared to the conventional approach of “work hard, pay taxes, live below your means and buy stocks, bond and mutual funds for the long haul” – we talk about the ranges of returns which are reasonable to expect when investing in certain kinds of real estate. We also talk about how certain deal structures can really improve your ROI.
Another topic of discussion is the risks of investing versus those of NOT investing. There is an adage which says that the more risk you take, the more return you should demand. We agree with that one. Of course, it presupposes that you understand the risks and can factor them into your decisions.
There is another adage which says that higher returns mean more risk. NOT NECESSARILY! There are actually deal structures which REDUCE risk while INCREASING return. So of course, we talk about those things because they are among our favorite benefits of real estate investing!
After this broadcast, we slipped off our leotards (sorry, bad visual) and headed for the showers (worse visual!), pleased with our performance. Now we’re waiting for the judges (that’s you) to put up our scores. We only ask that not take into consideration what we look like in our leotards. And, that you remember to take us to the gym because, as you probably already know after the leotard visual, we REALLY need the workout!
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1/3/10: Happy New Year with Gary Eldred – What Does 2010 Hold?
The easiest thing in the world to do is predict the past. But what about the future? As we enter a brand new decade, what does the future of real estate look like? To find that out, The Real Estate Guys climbed the proverbial technology mountain to connect with a real estate sage – all the way from Dubai!
Sitting on the mountain top for this broadcast:
- Your real estate guru, Robert Helms
- Pillow fluffer and co-guru, Russell Gray
- Trump University faculty member, best selling author, seasoned real estate and renowned consultant, Dr. Gary Eldred, PhD.
Digging through technological challenges, The Real Estate Guys mined some golden nuggets of wisdom from special guest, Gary Eldred who called in all the way from Dubai! As someone who has studied, taught, invested, and consulted on real estate for decades, Dr. Eldred has earned the right to have an opinion. We talk stocks, bonds, gold and real estate. Gary tells us which asset class he believes will outperform all others in the new decade – and why.
Gary also reveals his strategy for hedging against economic uncertainty. He tells us which type of mortgage he prefers right now and why. As one of the most well traveled investors we know, we also were intrigued by Gary’s comments China, India and Africa – and how what’s happening there affects real estate in the US and other parts of the world. Of course, since he was calling from Dubai (where he is currently working) and Dubai’s been top of the financial news recently, we made sure to talk about that too!
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