You never know what the future is going to hold for investing because of that you don't want your retirement portfolio to be something that just sits and isn't check up on every so often. That can be much easier said than done though. Because of that it is important to make sure you set your retirement portfolio is invested in a way that doesn't necessarily need to be checked on a semi constant basis. There are plenty of things you can do in order to limit the risk of investing but one of them is better than the rest for allowing you to do what you want. Investing with a self directed IRA allows you to invest in things other than the stock market. Using a self directed real estate IRA allows you to invest invest in things like real estate and is one of the best ways to truly diversify your retirement portfolio.
To find out what a self directed IRA can do for you and what you can invest in with a self directed IRA check out, What Makes A Self Directed IRA Better Than A Regular IRA? If you are ready to start investing let's start talking about how you should be looking more closely at the real estate market to invest more wisely in real estate.
One thing to remember when investing in real estate is that typically it is quite a big purchase. Usually you do not make as quite of big purchases than you do when purchasing a home, even if the purchase is for an investment. These types of big investments should have a bit of extra thought and analysis put into them.
One of the first things you should do when investing in real estate is to educate yourself about the market because there are metrics and reports that you can look at to get an idea of how the real estate market is performing. What are some of the best metrics to analyze? Looking at existing home sales, new home sales, pending home sales, building permits, housing starts and the home price indexes are the best metrics to analyze in order to get the best idea of how the housing market is doing.
I am not going to go into each metric and how it paints a picture of the real estate market I will mention that existing-home sales dropped by 1.8% in August while the new-home sales report showed a gain of 18% to 504,000 homes. So exsisting home purchases is slowing while new home sales is gaining. Although, the 1.8% decline in existing-home sales isn't significant and only represents a drop of 11,250 units (not a significant amount).
The sale of distressed homes (foreclosed or bank owned) was only 8% of the market, and that is down from 12% one year ago. This could mean that cash investors aren't purchasing as much. The good thing with that is that it leaves more homes for sale for first time home buyers.
While the current outlook may be a bit down than it was last year around this time the long-term outlook is still very good with many metrics pointing positive for many first time home buyers.
It is important for you to get educated about investing in the real estate market. Using a self directed real estate IRA is a great option to diversify your retirement portfolio but doing it the smartest way possible means that you'll have to do a little work on your part and get educated so that you can invest when the timing is best for you and the market.
If you need helping setting up a self directed real estate IRA so that you can invest in real estate contact us for more information or for help setting up your account.
Author: Nick Barker