Investor Quarterly™ June 2016 | Page 14

Additionally, US property values have continued to fluctuate over time, due to changing demands, even if the property doesn’t undergo any changes. To date US real estate has always gone up in value, even though there have been fluctuations. 14 14 Short-sightedness and inefficiency in predicting these changes cause some to sell low. Yet, those that understand the data, trends, and factors involved have the ability to reap windfalls in equity by acquiring these assets simply with good timing and good negotiation skills. How much is that Asset Worth? of by managing the fundamentals themselves. One of the first things that intrigued me about real estate was the unique opportunities available to achieve high returns, with the added advantage of being able to control your own asset values. Running the numbers, it seemed the most obvious and common sense approach to outperforming the performance of my stock market portfolio. Another factor is that the real estate market allows you, the owner/investor to do things that would increase the value of real estate through management. Thus, often enough a skilled investor could negotiate the purchase of a property for $75,000, within a short time, and with $5,000 or so worth of management and marketing expenses or physical improvements, could resell it for $130,000. That creates a gross profit of $50,000. Stocks have proven highly inefficient for consistently generating reliable high net returns, and value when you need it. Many advertise being able to ‘beat the market’. Yet, when it comes time to invest the