Do you have too much realestate?

Question

Is your overall wealth over weighted in Real Estate.  Do you care or what is your strategy when building wealth through real estate.

Russell Brazil · Answer

I try to stay around 50/50 stocks/real estate. But of course when one goes on a run, or one dives it throws that proportion out of alignment. Like now stocks are down like 30% on the year and real estate is up 10%ish (mine is a little more like up 7%). So Im oit of alignment, but I suspect the market comes back next year getting me back closer to equilibrium.

Eliott Elias · Answer

Hold as much as possible, only time I flip or wholesale is when i need cash to close property. I don't like any other investing arm.

Nicolas Londono · Answer

I'm about 130% into real estate... that means I only own 1 property and owe money, so I have more than I own in real estate...The way I see it... real estate is how I make my money and I still don't have enough to worry about diversification... later in life I'll go from wealth creation to wealth preservation when diversification becomes critical. if you have one egg you can only use one basket.

That being said, play safe... every property you own is like one of those flags in super Mario, if you die, you will re spawn on one of those... don't risk your flags, only your current project

Steve Vaughan · Answer

Riddle time.

I was about 94% RE, 6% stocks.

Then I sold about 90% of my RE this year, but it still represents 94% of our holdings.

Discuss.

John M. · Answer

Just for clarification I'm 100% real estate and my wife is 100% stocks via a 401k.  I guess that makes us somewhat diversified but if I had to run the numbers between the both of us I would say we are 80% real estate/20% stocks.  Any Cash is immediately spent or reinvested back into real estate.

Henry Clark · Answer

Your question when building wealth.  I’m going to take the question to get to financial freedom and not just as an investment.

Currently we are past our number. 25% stocks and pension plan, 25% farm ground, 25% Self storage, 25% development land for Self storage or housing subdivision.

Even considering  the run up in both stocks and REI.  We are probably 6 times ahead on our REI gains.  BUT, we don’t do buy and hold in REI unless it’s heavy cash flow like self storage.

Although the development ground is buy and hold its only for 2 to 5 years.

To me the answer is about gains but also Risk tolerance.  Starting out I would rather be heavier into my day job and stocks.  Until I reach REI position of knowing our downside potential.  Then going heavy into REI.

At our life  stage we have moved to a five year liquidity position.  All future Life spending events are covered,   The rest is actively working in Real Estate.  Keep in mind my wife and I are two different types of investors.  Five year liquidity is to assuage her financial concerns.   Whereas I like to Develop.  Both are totally opposite each other.

Plus a little set aside for hot chocolate and deserts in Napoli or other life pleasures.

Joe Villeneuve · Answer

I have stocks/funds etc...by accident because it's free.  My wife gets them with matches from her work, so I (we) have a lot of investments in those areas.  I have no idea (off the top of my head) what the ratio is (don't care really), because I buy/sell RE when the time/opportunity presents itself.

Do you have too much realestate?

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