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The landscape of American homeownership has morphed dramatically, echoing with the weight of sky-high interest rates and stubbornly elevated property prices. The strain on homebuyers has never been more palpable, as they grapple with diminished budgets in the face of soaring costs.
In a recent tête-à-tête with YouTuber VladTV, the astute real estate magnate Grant Cardone lamented the perilous state of the housing market, forecasting an imminent surge in both rental costs and property values throughout the next decade. Cardone’s alert hasn’t gone unheeded; the sirens of alarm bell he’s ringing reverberate louder as days pass.
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During his most recent podcast dialogue, Cardone emphatically advised, “Rent the space you inhabit until your financial situation is robust… Current rental prices are approximately half of what it costs to own.” He advocates using accrued liquidity to establish investment funds aimed at acquiring commercial real estate.
Last year, Cardone foresaw a monumental transformation in societal norms and consumer habits, predicting an era where renting prevails in our lifestyle choices.
“America will inevitably evolve into a renter nation,” he forewarned, elaborating, “You’ll rent your vehicles, your residences, and who knows, possibly even your attire someday.”
But for those determined to delve into the world of real estate investment, amid its reputation as an inflation hedge, a source for passive revenue, and a path for portfolio diversification, rest assured: viable strategies exist that eschew massive debt.
Let’s dive into three alternative avenues of real estate investment.
Harnessing crowdfunding platforms
Today, many aspiring buyers feel like they’re being pushed out of the market. Mortgages have reached historical heights comparable to 2001, with average rates hovering just shy of 7% in 2024. Specifically, as of late June, the 30-year mortgage rate stands at 6.87%.
In a prescient statement back in 2023, Cardone emphasized the impending need for significantly extended mortgage durations.
“America’s redemption won’t stem from reduced prices; it will derive from prolonged mortgage periods,” he stated in one of his TikTok snippets. “In our lifetime, we may witness mortgages extending beyond 30 years — think 40, 50, or even 60. If fate allows, a century-long mortgage could become a reality.”
Fortuitously, you can engage in residential real estate investment without the cumbersome responsibilities of property management.
Crowdfunding, a term that has risen in popularity, entails pooling investments from numerous individuals to fund projects. Several platforms now facilitate ownership stakes in diverse physical real estate assets, ranging from rental abodes to commercial complexes and land parcels. This innovation democratizes the realm of property investment, breaking down barriers and simplifying entry for the average person.
With backing from prominent figures such as Jeff Bezos, Arrived emerges as a platform permitting investment in shares of various rental homes and vacation properties, all while sparing you from the intricacies of property management.
With a low minimum investment threshold, you can explore their expertly curated selection of properties, selecting shares in line with your preferences. After securing your shares, enjoy the ease of receiving quarterly distributions from rental revenue.
Read more: Even titans like Jeff Bezos and Oprah Winfrey invest in assets that fortify their wealth — perhaps a similar strategy is in your future for 2024.
For accredited investors, private real estate funds present another enticing opportunity. Investment options, such as those curated by firms like DLP Capital offer tax-efficient, private REITs that primarily focus on acquiring or developing safe, affordable rental residences aimed at working families. Investors partake in earning passive income through systematic monthly, quarterly, or annual payouts, thereby substantively contributing to the uplift of American communities.
Exploring commercial real estate opportunities
For high-net-worth investors casting a wide net, the allure of commercial real estate beckons fiercely. Beyond residential properties, opportunities nest in necessity-based real estate, which fulfills essential consumer needs — think grocery venues and healthcare establishments, steadfast in their capacity to generate reliable cash flows even amid economic turbulence.
Platforms like First National Realty Partners provide investors access to premium, grocery-anchored commercial properties leased by renowned national brands. The intricacies of investment management are seamlessly tended to by their professional team of experts.
Beginning this journey requires merely sharing information regarding your financial standing and investment ambitions, paving the way for the prospect of earning quarterly returns from your fruitful investments.
What lies ahead?
This article conveys information solely for illustrative purposes and should not be misinterpreted as financial guidance. It comes without any guarantees of accuracy or completeness.
