You have to be able to borrow cheaply and maintain properties with tenants. Inflation hedge Yet you can invest in real estate today and own both residential and commercial property, even foreign real estate, using real estate exchange-traded funds (ETFs) . In a well-designed retirement portfolio, a small holding in real estate acts as a hedge against inflation that generates income, similar to bonds but with the inflation-dampening effects of commodities investments . One such ETF is the SPDR Dow Jones Real Estate REIT (RWR). It tracks a broad collection of U.S.-based REITs, or real estate investment trusts. REITs are simply companies in the business of buying and managing real estate, often apartment complexes but also commercial properties such as malls and healthcare facilities.
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Real estate investing requires a new way of thinking about your money
I bet many of you are thinking those rates are criminal. Some debt, though, really is good debt. People will scoff at a deal like this and then go take out a $50,000 loan at 5 percent on visit the site a car (a rapidly depreciating asset) that is worth 20 percent less the minute you drive it off the lot and think its a great deal. A 5 percent rate on a depreciating asset is a much worse deal than a 16 percent rate on a deal with a 30 percent profit margin. You also dont need millions of dollars to do this. There are local brokers who pool money from smaller investors.
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