1. Stock Market Analysis and Personal Finance
Mr. Bernstein
Real Estate Investment, pp
April 30, 2013

2. Stock Market Analysis & Personal Finance Mr. Bernstein
Direct Real Estate Investments Purchase of legal title to property Is your home an investment? Can a vacation home be an investment? Rental units – duplexes, storefronts, apartments, etc. The US Government offers tax incentives to purchase many types of real estate

3. Stock Market Analysis & Personal Finance Mr. Bernstein
Indirect Real Estate Investments Limited Partnership (no longer carries former tax advantages) REITs Profits from Real Estate operations flow through to holders pre-tax Often pools of investors and diversified portfolio of assets Often trade on an exchange like a stock or ETF

4. Stock Market Analysis & Personal Finance Mr. Bernstein
Advantages and Disadvantages of Real Estate
(+) In theory, will rise with inflation
(+) You may have personal information about properties that most potential investors do not
(+) Indirect investments provide diversification and limited liability
(+) Lenders allow considerable leverage – 50-75% not uncommon
(+) May reduce risk of overall portfolio
(-) Direct investments are illiquid