X-Message-Number: 20640 From: "John de Rivaz" <> References: <> Subject: Real estate investment Date: Tue, 17 Dec 2002 11:33:16 -0000 ----- Original Message ----- > > You can have the same thing in North America by buying Shares in > > Real Estate Investment Trusts (REITs) The return is excellent, at > > least for now.. I have small positions in 4 of them: > > > > I think the same must hold true in most countries under a name or another. It > seems a good alternative to insurance or speculative stock market. In forty > years, I have never seen a crash in the real estate domain. I have had real estate investmnents since the mid 1960s. I have lost money one some, gained on others. There have certainly been several booms and crashes in the UK. At present most of the world seems to be in the grip of a boom exactly like the technology boom that bust in March 2000. There are other parallels. If you have been a long term (several decades) investor in anything with boom bust cycles, you usually end up with a profit even just after a bust. That is unless you happen to invest at the top of a boom cycle, when it can take an inordinately long time to even get back what you paid for your investment. I really would advise against investing in real estate right at the moment -- it is at the top of a boom cycle. There are particular problems with real estate investment if you buy properties directly. 1. It involves personal contact with lawyers, estate agents, insurance salesmen and thereby a lot of parasitical expenses, and possibly associated taxation, that are unquantifiable. 2. The blocks of money that have to moved attract unwelcome attention from the taxation authorities -- you cannot take capital gains in small doses so as to avoid tax penalties. 3. Whilst you own a property you can suddenly find yourself liable for a big item of expense (repairs, change of tenant, defaulting tenant etc) There is an advantage: you can get tax relief on any loan used to buy rented property. With stocks, 1. the buying process is almost anonymous and any charges are clearly defined 2. you can take a small amount of gain each year for re-investment without suffering a tax penalty 3. If a company suddenly offers more shares to stockholder, you can ignore the offer without any problem at all. You cannot get tax relief on a loan to buy stocks. -- Sincerely, John de Rivaz: http://John.deRivaz.com for websites including Cryonics Europe, Longevity Report, The Venturists, Porthtowan, Alec Harley Reeves - inventor, Arthur Bowker - potter, Holistics, de Rivaz genealogy, Nomad .. and more Rate This Message: http://www.cryonet.org/cgi-bin/rate.cgi?msg=20640