The main inefficiency in the real estate market is that sale price and rents are not exactly aligned. So to be successful in rental properties, that expertise is finding the markets where rents are relatively higher than sale prices.
I had in mind what I stated. To be successful, an investor in individual rental property either has to be lucky, or has to have the expertise to exploit inefficiencies in the real estate market to generate property alpha to compensate for the concentration risk. It is much more feasible to do that than it is for stocks, but it does take some expertise and knowledge of the local market.
But consider the long term rental property business model. You buy a property at today's prices and amortize it over 30 years. Your revenue is the rents and those rents would be expected to go up faster than Inflation over 30 years.
Statistics: Posted by rufflesinc — Sun Jan 19, 2025 7:24 pm — Replies 22 — Views 1757