New York City, NY · Member since 2013 · 7 posts · 0 votes
Hello,
New to the site, but not new to investing in the equity and FI markets. Was curious as to how you seasoned Real Estate investors analyze potential opportunities in the crowded coastal area (LA/SF/BOS/NY) where even the 1% rule is almost non-existent. While physical real estate for rental income purposes offers less correlation with the broader equity markets than REITS, at what point do the yields that REITS offer become more attractive financially than the physical direct investment?
Investor · Willow Spring, NC · Member since 2009 · 5k+ posts · 3k+ votes
12y
You post a good question. I don't invest in the 4 cities you mentioned. But see this related BP topic (http://www.biggerpockets.com/forums/88/topics/110262-thinking-of-an-investment-in-a-hedge-fund) specifically the 'side bar' post I made a few days ago on the 2% rule for multi-family REITs. The Multi Family investment can achieve a better gross profit margin than an individual investor (non-MF) equivalent.