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Thread: Stacking physical cash

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  1. #11


    Quote Originally Posted by theplantguy View Post
    One area of my investments that I have given a great deal of attention to has been income producing assets that can track fairly well with inflation. After all, in retirement, we don't need so much a pile of cash to live off of, as we need a steady income stream. The two are not the same.
    PG, while I agree with you in spirit, having had two rental properties I can safely say that investors have been burned on real estate in the following ways:

    - Negative equity where the cost or buying and repairing the property is less than its market value.

    - There is a reduction in property values generally due to prices going up too much when borrowed money was more freely available prior to the credit crunch and they are now retracting.

    - Cost of maintenance and other unexpected repairs.

    - Tenants trashing the rental property.

    - Cost of eviction.

    - Interest rates going up pushing up costs of borrowing caused by banks trying to rebuild their balance sheets because they have bad debts associated with real estate.

    - Over leveraging where banks call in loans and put real estate businesses into liquidation to recover some capital.

    - Unavailability of capital to complete projects.

    - Increases in property taxes by governments scrambling for cash to fund bail out plans caused by unavailability of funds due to the financial system crises.

    - Rent controls.

    - Planning permission delays and rejections.

    - Falling rents due to oversupply. Entire estates have been destroyed in some areas due to oversupply. There can also be periods when the property can not be rented due to oversupply.

    - Exorbitant property management fees being charged on apartment complexes.

    Also, other "passive" income, like blogging, rental businesses, etc all require work. Building a small business nowadays is difficult due to regulations, taxes and employee issues.

    There is no free lunch. I am glad that you, at 70+- years old have been able to be successful. For all the Jeff Bezos and Steve Jobs of the world (and Plantguys), there are hundreds of failures. And they are not ALL from being lazy, uninformed or stupid.

    Quit making it sound like getting into passive income is a snap. Also, be more specific about it if you really want to help people here out. What were some of your greatest failures? What do you need to be a success? What are your top five (specifically) passive income ideas?

    Last edited by Atlas Shrugged; 12-15-2011 at 04:55 PM.

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