I don't invest Directly in Real estate need Perspective

[william the wie]

I have been bailing on blue wall real estate recently because the returns are not really competitive with other sectors and regions. Any idea how bad it will get for the REITs and mortgage companies before it will become worth buying in again?

 

[MarathonMike]

FYI My REITs were sucking wind all year but have recently (last 2 weeks) flipped from negative to positive for the year. I haven't checked to see if that is a general REIT trend or not.

 

[william the wie]

I've been doing well, but not great, with the oil patch.

 

[MarathonMike]

I've been trading oil drillers also with some success.

 

[william the wie]

I've been trading oil drillers also with some success.

The pipelines, particularly NG, are a steady return.

 

[Mac1958]

RWR is up 9.44% since mid March.

That's a broad market REIT ETF, but indicative of the sector.

 

[william the wie]

I use a simple screen Beta >1 and dividend greater than 8% my monthly compounding is 1-2% but these issues are not big movers on price and worse yet the higher yield issues are quarterly yield not monthly div payers.

 

[Picaro]

Only 'hot' sectors are the narrow bands at the low end and the high end, and it is mostly flippers driving a lot of the market. and jacking up prices. Too many flippers, and not enough consumers with god enough credit to afford buying much, so soon it will be just another bubble memory. Time to buy was after the crash a long time ago. I bought mine after the Bush I crash, three of them for the price of one at the time. Didn't need to borrow, so no worries about getting upside down on them. Spent a lot on remodeling, didn't scrimp on that, and it's paid off great, though the up front costs were high.

Forget real estate at the moment; it's being touted, but I see new houses standing vacant around here for over 9 months, and we're supposedly the 'hottest market in the country'.

 

[Old Texas Reb]

REIT's have always been good to me because I've picked them selectively and avoid those who are too highly leveraged or don't have a good track record. Sectors are important too. One of my favorites is WRI (Weingarten Realty). I've owned it for more than 25 years. Growing up in Houston, Weingarten was a familiar name.to me. They are very conservatively managed, have split several times and are up 24% since I bought them.

"Sin" stocks like Altria and BAT are good bets for the future. MLP's (pipelines) can't be beat IMO.. I've owned mine since the late '80s and have seen large gains and returns. A caution here: stay away from midstream or production MLP's and stick to the pipelines that have been around awhile like Buckeye and Oneok. Also, be aware that if they ever get rolled up into a corporation you are going to get hit with an ordinary income "recapture" on the sale which can be significant if you have owned them for a long time. Tax reporting can also get complicated. Best bet here is to buy them and hold on for your lifetime.

Since most of my working career was in the petroleum industry, I know the area well and stick with the big boys like Exxon and Royal Dutch Shell. They haven't disappointed!

 

[Picaro]

REIT's have always been good to me because I've picked them selectively and avoid those who are too highly leveraged or don't have a good track record. Sectors are important too. One of my favorites is WRI (Weingarten Realty). I've owned it for more than 25 years. Growing up in Houston, Weingarten was a familiar name.to me. They are very conservatively managed, have split several times and are up 24% since I bought them.

"Sin" stocks like Altria and BAT are good bets for the future. MLP's (pipelines) can't be beat IMO.. I've owned mine since the late '80s and have seen large gains and returns. A caution here: stay away from midstream or production MLP's and stick to the pipelines that have been around awhile like Buckeye and Oneok. Also, be aware that if they ever get rolled up into a corporation you are going to get hit with an ordinary income "recapture" on the sale which can be significant if you have owned them for a long time. Tax reporting can also get complicated. Best bet here is to buy them and hold on for your lifetime.

Since most of my working career was in the petroleum industry, I know the area well and stick with the big boys like Exxon and Royal Dutch Shell. They haven't disappointed!

The market see saws a lot so yes, there are always times when nobody wants it and the prices are cheap; there are also usually better investments around, too, that will generate returns faster, while real estate takes a while to build up the next bubble. It relies too much on cheap Federal loan money, though, so the next bubbles probably aren't going to be near as large as the last one got.

Pipelines are usually good during booms, too, and they're similar to railroads in that they tend to be monopolies or duopolies and have govt. subsides associated with them.

 

[Muhammed]

I have been bailing on blue wall real estate recently because the returns are not really competitive with other sectors and regions. Any idea how bad it will get for the REITs and mortgage companies before it will become worth buying in again?

You're not DJT.

Stay away for now.