The final real estate advantage is subtler than the others but makes a significant difference for many investors: MANAGEMENT.
By management, we mean having control of your future and not leaving it in the hands of CEOs or investment advisors.Managing your investments is a key to financial success.
You have little or no control over your stock or bank account performance.At least with stock you can buy and sell to change management in an attempt to control your future to get a better return.Self-managing your bank account is non-existent.Typically, your ability to manage your 401k is restricted to the funds your company has offered.Clearly, others control your financial future.
With a real estate investment, you are the management and have complete control over your investment and financial future.You can quickly evict problem tenants in most states to correct a problem.CEOs wish they could act that fast.If you do not want to manage tenants directly, you can manage a property manager that will deal directly with the tenants.
At YellowMustang Holdings, we have property managers for all our properties.It is easier to change property managers that do not meet our expectations than to evict a tenant.We control our real estate investments through our property managers and spend our time looking for more investments.
What happens if you are a bad manager of your own future?The key is not to get to that point.No one is an island.All successful real estate investors have a team to help them, mentors to guide them and networks to keep them current.Your team should consist of lawyers, real estate brokers, tax accountants, contractors, etc.Your mentors should be other successful real estate investors.Networks can be local investment clubs, gatherings of like-minded investors in your area or on-line blogs and websites.
While it takes no effort to invest in savings accounts, you get an equal amount of control and return on investment: none.The effort to invest in stock through your 401k, normally via mutual funds, takes some effort with an increase in your control and return.Successfully investing in individual stocks can require as much if not more effort and knowledge than real estate investing but with lots less control over your future and less return over time.Real estate investing puts you in the driver’s seat, where you belong.
