July 25, 2024

Chris Martin Shares the Do’s and Don’ts of Alternative Investment

financially independent in this fast-paced, progressive, and fee-based world is challenging. Taking alternative routes, many people are now moving toward real estate investments and other non-traditional investment strategies outside their retail broker exchange to establish financial freedom.

A specific class of investments called Alternative Investments is particularly interesting to Chris Martin, who has dedicated his career and work to building portfolios of assets.   Martin has made a few wise investment decisions over the years and seeks to continue his success.

Sharing his transformational journey and his relationship with money, he narrated his father’s favorite quote from Robert T. Kiyosaki, Rich Dad, Poor Dad, “Most people fail to realize that in life, it’s not how much money you make, it’s how much money you keep.” These words have helped him to learn and unlearn everything about financial freedom.

Martin believes traditional money-saving strategies have been challenged over the last 20 years. For example, when was the last time you thought of locking your savings into a CD interest-bearing savings account? You might be surprised, but many groups yield 4.4% APY on just a 12-month CD. That has been unheard of for a very long time. As the owner of GlenMartin Investments, Martin shares the do’s and don’ts when preparing his clients to invest in real estate investments.

Asset diversification

Real estate properties generating stable income prove to be much more profitable to invest in than simply owning land with asset appreciation and no ongoing revenue generation. Steady income enables real estate to be debt-financed, which is a percentage of the equity invested into the asset.

Generally, revenue can service the debt and the interest creating a stabilized real estate investment.  When you couple these elements with a geographically diversified set of assets, enormous amounts of de-risking is gained from your overall investment. Why? Real estate experiences market cycles going through periods of market increase in pricing and possible long periods of market declines.  A wide variety of market economics can drive pricing and demand within a specific region. Thus, if you’re investing in a portfolio of assets with a similar overall value, it could be advantageous to spread them across multi-geographic markets. Within real estate, typically an inverse relationship between price and interest rates exists.

Only consider investing when you have a strong cash flow

\Income diversification aside, study closely your current cash flow and the potential cash flow you can generate before investing in real estate. If you’re confident, you can generate a stable income stream, do your due diligence and confirm you’ll hold firm commitments before acquiring. The old adage applies here; they aren’t making any more land. To get a property up to market condition can require a significant amount of capital. Furthermore, maintaining a property can be costly. Servicing not only debt, insurance, and taxes is a  sizable expense seen on almost all properties unless you’ve managed to negotiate a period of tax abatement. So do your homework before you commit to any investment.

Do extensive research about the property

 Having ample knowledge about the property you invest in is very important. Before diving into the investment plan, you must understand the current market conditions. Significant market research is available within the US, but this can become much more challenging outside the country. Building a road map of what the property will be worth and the amount it will return to your investment can’t be left to guessing or chance. Martin believes this to be the most crucial step because, without extensive research, an investment strategy, plan, budget, and follow-through, you may make a very poor decision to purchase. Buying at the right price is always the name game then you must find your unique opportunity to grow value.

Talk to someone familiar with the local real estate market

Talking to someone who has already invested in a specific real estate market is always a good idea. Real estate is a highly territorial asset group generally held by large funds, high net-worth families, and/or other institutional groups. They can inform you of the specific real estate asset class and help you understand current market trends better.

Martin integrates these strategies into investment funds for aspiring property investors, assisting them on this seemingly daunting and taxing task. His strong knowledge of real estate investment and trusted partners have enabled many to succeed. None of this comes about by chance, as it really takes a lot of hard work.

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