Real Estate Investing: How to Play the Housing Market Without Buying a House

Real Estate Investing: How to Play the Housing Market Without Buying a House


Chris Hill: Hey, everyone!
Thanks for joining us! We’re coming to you from Fool
global headquarters in Alexandria, Virginia. I’m Chris Hill, joined by Matt Argersinger
and Austin Smith. Thanks for being here, guys! We’re going to be talking real
estate investing. We have a lot to cover. But speaking of a lot of information about real
estate investing, we have a free 40-page e-book. It covers everything. Whether you’re a newbie or you’re an experienced
investor, there’s a lot of great stuff. I know you guys put a lot
of work into that. It’s free. You can get it by going to real.fool.com. We’ll take your questions in
a little bit about real estate investing. But Matty, let me just start with you.
We talk a lot in this studio about stock investing. Real estate investing,
why is it so appealing to you right now? Matt Argersinger: It’s been
appealing to me for a long time, Chris. I’m so excited at The Motley Fool,
we’ve really taken a big step into the asset class. I think a lot of investors who’ve been following
The Fool for years probably think of real estate, they immediately think of REITs,
or maybe they think of buying a rental property, a home, renting out part
of their home, maybe through Airbnb. And that’s the extent of
what they think about real estate. They don’t think about the idea;
can I own a piece of an office building? Could I own a self-storage facility?
Could I do those types of things? What’s remarkable is, yes. The answer more
than ever before today is yes, you can. The individual investor has more options today
— we’re going to talk about lots of them — to get into real estate investing and to
do it in a way that really was only available to very wealthy, very connected
investors as little as five years ago. That’s what Austin and
I have been working on. I’m trying to expand the investor set
within the marketplace. It’s really exciting. Hill: It’s a great point! Austin, obviously, stock
investing has revolutionized over the last 25 years. But I think, to Matt’s point, a lot of people
don’t think about real estate in the same way. And the fact of the matter is,
there are tremendous opportunities. Austin Smith: Technology is really
a tidal wave in this industry right now. We keep saying to ourselves, this feels like
where equity investing was 25 years ago. The door’s cracking open. Individual investors are really getting unprecedented
access and benefits in real estate that have been a challenge to access before. With things like crowdfunding, the advent
of technology that supports so many investors, really unique tax benefits like opportunity
zones, are really making this space so compelling, even beyond what people
have been used to. We’re really excited to cover all of
the ways that you can profit from real estate, which is more than just buying
a rental property or renting on Airbnb. Hill: Let’s talk about a few of the ways
that you can play the real estate market. Obviously, to Austin’s point, buying a home,
right off the bat, for a lot of people, if you do that the right way, let that expand
over decades, that can work out well for you. Argersinger: Absolutely! Buying a home, I think, is how
almost all of us get started in real estate. We don’t think of ourselves as real estate
investors when we maybe buy our primary home. But it can become that. You can think about, instead of buying a single-family
home, maybe you buy a duplex; you live in one, you rent out the other. Or, you could have
an accessory apartment attached to it. Or, you just buy your first home, buy another
home later on that you move to, and continue to rent your first home. I think that’s a lot of ways
we become landlords, in a small way. That’s our introduction into real estate investing. Beyond
that, the world gets a lot, lot bigger. It’s interesting. We’ll talk about REITs.
REITs came about in the 1960s. They’re mutual funds of real estate. It’s a great way, today and back then,
for investors, in a single investment, to own a piece of many,
many properties around the country. You get diversification instantly
through investment. We have a chart. If you look at investing in REITs over the
last 20 years, if you just invested in equity REITs vs. the S&P 500,
they’ve massively outperformed. I think $100,000 in REITs has more
than doubled, it’s grown almost to $700,000. That’s done much than the stock market. And that’s probably surprising to a lot of
people, given the fact that we had a pretty big financial crisis in 2007 to 2009,
which was driven in part by a housing crisis. REITs suffered during that period
of time. But they bounced back. And over that period, they’ve done
substantially better than the stock market. So, starting with your primary home, but then
maybe moving up to REITs, and then, of course, even beyond that, we can talk about. Hill: You think, Austin, about the individual
stocks out there, whether it’s home builders, or even companies that are in the home
improvement business like Home Depot and Lowe’s. I think for people who are stock investors,
who maybe don’t want to jump immediately into a REIT — we can get to some of the pitfalls
with REITs in a second — there are obviously stocks that they can go
to right off the bat. Smith: Absolutely.
You mentioned homebuilders. We think NVR is an
exceptional operator in this space. There’s also tech-powered real estate companies
like Redfin and Zillow that are really interesting to watch right now. Redfin in particular is a company that we
feel like has really strong leadership. Zillow just had a change of leadership.
There’s a lot of changes occurring there. Both are tech-powered real estate, but also
the advent of i-buyer programs being a really interesting addition
to these companies. There’s a lot of different ways to get access
to the real estate space in equities or REITs. If you want a microcosm of what Matt was talking
about, about the potential strength of REITs, today in the market, we were looking at a REIT
portfolio, eight or nine REITs that we follow. They were all in the green,
the market was in the red. I think there was one that
was just slightly below the line. But nice to see on a day that, when the market is zigging,
the real estate sector as a proxy is zagging. Argersinger: That’s another great point. If you look at just REITs, for example,
REITs tend to have a correlation to the rest of stock market between 0.4 and 0.7, which means
there’s some correlation to the stock market, but it’s a weak correlation. On a day like this, the market’s
down, REITs tend to hold up better. We saw in, I think it was May,
when the S&P had a really tough month. I think the S&P 500 was
down between 6% and 7%. The real estate sector and REITs were
the only part of the market in the green. If you’re looking at your portfolio and saying
to yourself, “Gosh, I love my stocks, I love the companies I’m invested in, but I’m pretty
heavily weighted in tech and maybe some other places,” maybe real estate’s
a place to look at. Hill: Let’s go back to something you
mentioned earlier, Matt — office buildings. That’s something I think a lot of investors,
myself included, don’t really think of when we’re looking for
opportunities to invest. But those are the types of deals that you
guys are working on in the service you run. Argersinger: That’s right. Austin mentioned the technology
that’s come about in the last five years. Really, it’s crowdfunding.
You have a lot of platforms out there. We’re working with several of them. Now, from the convenience of your laptop,
you can make real investments in single-asset commercial property, in institutional-quality
property, from around the country. One of the first investments we made when
we opened our service — we’ll talk about our service — we invested in a class A office
building in Tampa, Florida. Wonderful investment. Probably going to do about 17% annual returns
for us. It’s a signature building,
a signature asset in a great location. That really wasn’t even
possible more than five years ago. The passage of the JOBS Act, new regulations,
new technology, have enabled a lot investors with few clicks of a button
to make real investments in real properties. Hill: Well, and it’s a good reminder that,
just as investors, if we have a consumer experience at a store, whether it’s good or bad,
that’s not necessarily a reason to go out and buy shares of that retailer.
You mentioned Tampa. There are a lot of people who may be watching
and are thinking, “Well, where I live, it feels a little bit like a real estate bubble,
maybe it’s not a great market.” Tampa is one of the best markets in
the country right now, in terms of real estate. Argersinger: Absolutely! The whole state of Florida
has seen a huge influx of population. A lot of people think that’s because
a lot of seniors move down there. That’s actually not the case.
They’re seeing rapid employment growth. A lot of younger people are moving to
places like Tampa, St. Petersburg, Jacksonville. There’s a big trend, kind of a lot of the
Northeast cities — places like New York City, New Jersey, Pennsylvania, are seeing a lot of outflows.
Population is going South and Southwest. One of the places we look as we’re making
these commercial real estate investments is states like North Carolina,
South Carolina, Atlanta, Georgia, Florida. Texas is obviously seeing a big boom
in places like Austin and Dallas. And those are some of the locations
that we’re finding a lot of opportunities in. Hill: What are a couple of the metrics
people should be looking at when they’re looking to invest in real estate?
Whether it’s REITs or something else. Smith: Real estate’s going to have its own lingo,
just like any investing sphere. We focus on IRR. That tends to be one of the master metrics of real
estate investing. It stands for internal rate of return. It’s a total return you realize over
a period of owning an investment property. It includes distributions, or dividends, for our
equity investors out there, plus any appreciation when it comes time to
sell that property at the end. There’s also the capitalization or cap rate for short,
which is the inverse of the price to earnings ratio. This is a very quick way to look
at how affordable or expensive a property is. Hill: We’re going to get to a couple of REITs
for anyone looking to put REITs on their watch list. Matty, there are pitfalls. Despite what Austin was saying about what’s
happening in the market today, no one should just blindly go into REITs, just as they shouldn’t
blindly go into an entire industry worth of stock. Argersinger: Absolutely.
All REITs are not equal. First, there are REITs
for every part of the market. There’s hotel REITs, office REITs — we talked
about officers — retail REITs, senior housing REITs, self-storage REITs… there’s all kinds. Not all those sectors are going
to be performing well at the same time. For example, hospitality REITs are for the most part
trading at really bargain valuations right now. That’s because the
hospitality market hasn’t done so well. There’s been new competition that’s come
into the space, between Airbnb and others. There’s also fears that we’re at a cycle
peak for the stock market and the economy. Hospitality REITs tend to be the most
sensitive to changes in the economy. So, there’s that situation. Also, when investors start to look at REITs,
they’re always attracted by the dividends. REITs are required to pay out 90% of their pre-tax
income, so the dividends are usually pretty juicy. But just because you find a REIT that has
an 8% dividend doesn’t necessarily mean it could be a good investment. Usually, that’s a sign that it’s
paying out more than it should be. It’s probably not covering its dividend
obligations through its funds from operations. Plenty of pitfalls to follow. I would say, look for REITs that have been
around for a long time, that have consistently grown their funds from operations over time,
good managers with long track records. All the things we tend to look for in stocks
and good companies apply to REITs as well. Hill: Let’s get to some
of your questions in just one second. But, first, Austin,
I’m going to hit you first. What is a REIT that you’ve got your eyes on right
now that maybe people can put on their watch list? Smith: Sure. I have my eyes on it
and my hands, since it’s in my portfolio. Physicians Realty Trust, DOC, is really
interesting. It’s a relatively young REIT. It’s only been on the market for a few years.
It’s also still relatively small at $3.3 billion market cap. Pays a really enticing 5.3% yield. I hope,
to mass caution, I’m not yield-chasing there. We like this one a lot. It’s a really recession-resistant
industry in the healthcare sector. If you are believing that we’re late-cycle
and you want something that is going to be more durable in that volatile
environment, this is the sector to be in. And, there’s a really favorable macroeconomic
trend where a really large portion of the population is aging into a really
high healthcare need point in their life. We expect this REIT will see really high occupancy,
and we are seeing that today at above 93% occupancy across their portfolio.
Hill: Matty, what about you? Argersinger: Urban Land Institute
does this major survey every year. They’re an institute that has
tens of thousands of real estate professionals. They monitor and report
on the real estate industry. For two years running now, the No. 1 area
where their members are seeing the best prospects and the best opportunities
is warehouse fulfillment. That probably seems obvious, right? The rise of Amazon, even Walmart and
Target really required to have distribution within one mile of major urban centers.
It’s a huge trend, it’s been a huge trend. As consumers, of course, we’re used to the
idea of two-day shipping, one-day shipping, now same-day shipping.
That’s not going to change. These major companies need that. So,
the company I like is STAG Industrial, ticker STAG. It’s been around for a long time.
Really conservative management. They own major warehouse and distribution
facilities in nearly 40 states. Really broad. And, they have some of the best locations,
right outside major cities like Charlotte, North Carolina,
that’s growing, outside Dallas. Tenants include FedEx, DHL, companies that
need those types of facilities to process goods, distribute goods.
Pays almost a 5% dividend. I own the company.
I’ve owned it for a long time. It’s a recommendation for us in our service,
and it’s one I’m really excited about. Hill: A lot of great information.
Even more information in the 40-page eboo I mentioned. It’s free. Go to real.fool.com to get that.
Just type in your e-mail address. Let’s get to the questions.
A lot of great questions coming in from the viewers. Sandeep asks, “Can shopping mall
REITs survive the retail apocalypse? Will the retail bankruptcies
take the REITs down too?” That’s a great question because it gets that
a trend — Austin, we’ve been seeing these headlines for a few years now. Sports Authority, Toys R Us, more and more
well-known retailers that are either closing hundreds of locations or just
going out of business altogether. Smith: Sure. I’ll reference the oft-attributed quote here,
“Statements of my death were overly exaggerated.” That seems to be the case
with the retail space right now. We look at REITs like Simon Property Group
or Retail Opportunity Investment Corporation, ROIC, have been beaten
down on this downbeat perception. Now, I think you have to be choosy in this space. Let’s be
very clear, physical retail is under a lot of pressure. But when you look at some of these really
good operators, they might have central anchor tenants in grocery stores, which are going
to be a lot more durable in a tough retail environment. I’d say, can retail survive? Absolutely.
Is there pressure in the retail space? Absolutely. We’re going to be looking for retailers [REITs]
who have deeply undervalued assets in their portfolio, or maybe have exposure to tenants
who are going to be a lot more durable in a retail apocalypse.
Argersinger: Yeah, I agree. I think those are all good points. If you look at the retail segment of the REIT market,
it’s amazing to see the cap rates in that space. Cap rate, capitalization rate,
also mentioned earlier, it’s the net operating income of the property divided by
the value of the property. Usually, the higher that number, the quote-unquote
cheaper in most cases the property is. Some of the cap rates in the retail space
are in the 7-9% range; whereas, when I talked about warehouse and fulfillment earlier,
we’re talking the 4-5% range. That’s a huge spread. There are definitely going to be opportunities
in retail REITs. Simon Property Group is interesting. They actually own
some really quality properties. They’ve been divesting
a lot of their lower-tier malls. I think at some point, they might
be a good turnaround candidate. One we’ve actually recommended
recently is STORE Capital. The interesting thing about them is, think
of Wawas, or gas stations, or convenience store REITs, that’s what they focus on —
places where there’s high customer traffic, or generally a pretty captive audience. Single tenants, triple net lease,
pretty conservative management team. Berkshire Hathaway actually
owns a percentage of STORE Capital. That’s one in the REIT category that
I would say, if you’re looking for opportunities, might be one to look at. Smith: Chris, if I may, real quick,
we’ve been spending a lot of time on REITs. There’s a lot of value to be had there. But let’s talk about one philosophy we have
as we approach real estate that we believe permeates REITs, fix and flip, crowdfunded real
estate, multifamily properties — dollars follow people. We look at migration patterns really heavily. We believe that if you’re going to be making
a real estate investment, let’s make sure that the geography makes sense. Going back to the retail REIT question, if
there are really strong geographies that have really great inflow — maybe in Atlanta, maybe
a Denver, some of these more affordable emerging 18-hour cities — they stand a much greater
chance of surviving a tough retail environment. If you have the opportunity to acquire REITs
or properties that have exposures to these cities, we think that’s a much
safer pond to be operating in. Hill: Several people asking, “You’ve talked
about REITs, are there some non-REIT stocks you like to play the housing market as well?”
Smith: Interesting. I have two. Interested in Redfin and Zillow
right now. Two we mentioned earlier. I wouldn’t say that I have a favorite between the two.
I really love the leadership team at both. Glenn Kelman over at Redfin, Rich Barton over
at Zillow, recently re-assuming the helm as CEO. You have i-buyer programs at both. I think
either company could really be a runaway winner. In fact, the real estate industry is such that you
could see both be runaway winners. I own both. Really interested to
see how they both develop. Argersinger: One that comes to mind immediately
— I think Austin might have mentioned earlier — is NVR. It’s a home builder.
The track record is tremendous. They have a really unique business
model, too detailed to go into right now. Again, one of those home builders that for
a long time focused in the Mid-Atlantic region. They really expanded down to the Southeast.
A lot of those stronger markets we were talking about. If you like the homebuilding space, and it
looks pretty interesting right now on a cycle basis, that might be one to take a look at. Hill: JR asks, “Would you consider REITs to
be defensive stocks in case of a recession?” Argersinger: Absolutely, I think so. You have
to remember, even in a recession, REITs will suffer. Everything’s going to suffer. But the advantage that a lot of REITs have, especially
in the office categories or industrial categories, is that you have tenants
who have signed multi-year leases. Five-year, 10-year, even 15 or 20-year leases. As long as those REITs have strong tenants,
creditworthy tenants, tenants that are large and have good balance
sheets, they’re going to hold up. In a stock market downturn,
we’ve seen that REITs tend to hold up better. Hopefully, there’s not another housing crash
or something like that around the corner, because everything will do badly. But REITs tend to have less
correlation to the overall stock market. If you’re looking for a little balanced in
your portfolio, I think REITs can be a great option. Smith: In the real estate space as a whole, a triple
net lease is another great way to approach that. Matt’s actually provided investment
recommendations to our premium members. I believe they’re assuming
17 years of a 20-year triple net lease. What this means is, you have a lease that
is guaranteed, there’s an agreed-upon rate. The tenant on the property pays
all taxes and maintenance on it. So, your floor is guaranteed.
You know what you’re going to be making. And then, typically, the way these leases are written
is that there is some upside if they outperform. You get to capture some of the upside
without locking yourself into a downside. If you believe we’re late in the market cycle,
which many people believe, a triple net lease investment could be a really interesting way
to approach investing over the next few years. Hill: If you think about all the headlines
over the last year about interest rates, and how often that is the dominant business story
of the day, how do you guys think about macroeconomic stuff like interest rates
affecting the housing market? Argersinger: It’s a good question.
I tend to weigh macro less than other factors. Interest rates are important. REITs and real estate stocks in general, financial
stocks in general, tend to be a little more sensitive to changes in interest rates.
Again, I always think that’s a short-term phenomenon. I think the best operators, the companies
with the best balance sheets, no matter what happens to interest rates,
they’ll do just fine. Also, I do feel like money tends to fall back
to REITs, actually, when interest rates go down, just because there
becomes a real chase for yield. So, if you can find a really great REIT or
operator that’s paying 4%, 5%, 6%, and you’re confident in that dividend yield, as interest
rates plummet, you’re going to get 1.5% to 2% on Treasuries,
they become very attractive. But then overall, looking at the economic
picture, I think Austin said it right. If you find REITs that have long-term leases,
where there’s even built in price escalators, usually — most leases include 2% to 3% increases in
rents every year from great tenants — you’ll do just fine. Hill: You guys have talked a little bit
about industry-specific REITs. We’re getting a couple of questions
about that. You mentioned warehouses. Someone asked me about
data center REITs like Digital Realty. Are there industries at one end of the spectrum
or the other where you just think that this is looking particularly attractive right now? Or, like, “Ooh, boy, I can cross this off
my list because this industry REIT is just not going to be as good an opportunity as
anything else I see on the spectrum”? Smith: There’s going to be opportunities and
challenges at every end of the spectrum. So we don’t want to make any blanket statements
that data centers are 100% certain and retail REITs are 100% doomed to failure. There’s going to be some fabulous opportunities
in the retail category, I promise you; but it might be more challenging.
Be careful where you step. Maybe something like senior housing has really
good favorable macroeconomic trends behind it; but if you are acquiring either an individual
property or a REIT that has exposure to the wrong geographies, maybe where that local population
isn’t aging as quickly, that could be challenged. I don’t want to make any blanket statements
and write off any category, or have people migrate their money
to one category wholesale. Hill: Paul asks, “Are there tax considerations
with REITs that would make them more or less suited for tax-advantaged accounts like IRAs?”
Great nuts and bolts question there. Argersinger: Generally, I’d say REITs are
very favorable for tax-advantaged accounts. That’s where you love to have them.
They’re paying dividends. A lot of REITs pay monthly dividends. By the way, because of the way REITs are
structured, most of their dividends and distributions are considered
ordinary income distributions. So you’re usually going to pay your ordinary
income tax rate on those if they’re not treated as qualified dividends,
as we’d expect from a normal dividend company. They’re disadvantaged in that way if
you’re having them in a taxable account. So, if you’re able, putting them in a tax-advantaged
account like an IRA is a great option. Hill: Are there any
international REITs that you guys like? We’ve talked about different markets with
in the U.S., what about outside of the U.S.? Smith: I don’t have any
international REITs on my radar right now. Doesn’t mean there’s not a lot of great opportunities.
I just haven’t brought that into my recent analysis. Argersinger: Actually, because the
United States has the real estate investment trust, REIT, structure, it doesn’t really
exist the same way in other countries. You will find U.S.-based REITs like American
Tower, funny that it’s named that, that has significant overseas assets.
You can invest in them. Most of their assets
are still the United States. But that’s one example, where a U.S.-
based REIT is doing things internationally. You can play it that way a little bit. Hill: For somebody new to the space, would you
recommend investing in individual REITs or an ETF? Smith: I think The Motley Fool’s had a really
great track record and wonderful experience buying individual companies with the caveat of,
don’t put all your eggs in one basket. Whatever diversification can afford yourself
while buying individual REITs or individual companies, that’s generally the
way that we like to approach investing. Hill: Vince asks, “Is it better to invest
in a REIT or for you to take the money you’ve saved and own a property yourself?” We talk all the time about stock
investing coming down to temperament. There’s a different type of temperament
that comes with being a landlord. Argersinger: Certainly, Vince. As a person who owns rental properties —
I know, Austin, you do as well — obviously comes with a whole host of headaches. REITs are certainly the easy and nice and efficient
way, and low-cost way to invest in real estate. We haven’t talked a lot about
crowdfunding as another option. There are certainly ways
beyond REITs to invest in real estate. It just depends on appetite
for risk, appetite for time. If you’re willing to invest the time and the sweat,
in a lot of cases, you can go those routes as well. Hill: One viewer asks, “I’ve heard the term
house hacking get thrown around a lot lately. What in the heck is house hacking?” Smith: This is a really great rebranding of
renting out a spare bedroom in your house to help pay down your mortgage. Hill: OK. Another viewer asks, “How does
the whole accredited investor thing work? What is or is not
restricted to accredited investors?” Argersinger: Let’s talk about
commercial real estate crowdfunding investing. We talked about earlier, this rise
of crowdfunding platforms out there. Most of the opportunities you see today are
reg D opportunities, which means you have to be an accredited investor
to take advantage of them. A lot of the recommendations we’ve made in
the service, the real estate properties we’re investing in, you’ve had to be accredited,
which means, if you’re a single person, you have to have at least $200,000 in gross income
per year; if you’re married, that’s $300,000. Or, you can have a net worth of greater than
$1 million, less your primary residence. Those are the qualifications. If you meet those, you’re an accredited investor,
and you’re able to invest on these platforms. But we’ve also seen the rise of reg A and
reg A plus offerings, which are also private real estate opportunities that are
available to non-accredited investors. It’s still a very small part of the market. There aren’t a lot of platforms out there
that are doing that right now. But it’s growing. There will be opportunities, even if you’re not accredited.
Smith: We’ve talked a lot about these platforms. Let’s put a name to them so the
viewers know what we’re referencing. There’s many crowdfunding
platforms out there. We’ve interacted with
some of the largest ones. We see a lot of great opportunities on platforms
like RealtyMogul, RealCrowd, CrowdStreet. They tend to bias
towards accredited investors. RealtyMogul does have an option available
for non-accredited investors who don’t meet that threshold, as well as Fundrise. They specialize in what’s called regulation
A access, which is for non-accredited investors. Hill: Let’s talk for just a second,
before we wrap up, about Millionacres. This is a new venture from The Motley Fool.
What got you interested in this in the first place? It seems like, among other things, one of
the themes that we’ve hit here today is how it really seems like we’re just
getting started with real estate investing. The opportunity, as you said, Austin,
it’s a little bit like the late 1990s for stock investing, when you saw the rise, not just
of companies like The Motley Fool, but of brokerages going online, and discount
brokers like Schwab and Ameritrade and E-Trade, etc. Smith: I can’t speak for both of us,
but certainly what got me interested in Millionacres, and why we’re here today, is that this
space is larger than the equity space. There’s so much money to be made. But also, up until very recently,
it’s been obfuscated and challenging. It’s really intimidating to people. The Motley Fool’s mission is to help demystify
these spaces, to shine a light on these opportunities and say, “Hey, there’s a really fabulous way
to make money here and improve your wealth and your lifestyle. Let’s educate you to get there, help you figure
out how to navigate these waters, understand where the good and bad opportunities are.”
Penny stocks? No, thanks. Great, well-run companies? Yes. Really derelict properties
down the street? Maybe not. But, a really great
crowdfunded deal? Yes. We’re here to play that same role that
The Motley Fool did in equities for real estate, and shine a light on all the ways that
people can invest in it. It’s really exciting. It feels like where The Motley Fool started. Especially with the emergence of technology
in the space, there’s so many great ways for people to invest all across the country,
either be it through REITs, crowdfunding, and half a dozen other excellent avenues.
Argersinger: Couldn’t have said it better. I would just add this one little piece. Earlier this week, we all went to Nobu, famous
Japanese restaurant right here in D.C. We dined with a lot of our members. We also dined with the folks who
managed that property, who we’re invested in. That’s an example of a recommendation that
we recently made to invest in a restaurant in one of D.C.’s hottest neighborhoods,
in a beautiful luxury condominium building. That was a real recommendation that
we’ve made, that our members are invested in. Just imagine the idea of investing in a property
just like you do if you bought shares in Starbucks. You go there, you order your coffee every
day, you feel like you’re contributing to the Starbucks brand. Well, imagine owning a property, investing
in a property, and going to visit that property, and dining at the restaurant that
is the main tenant of that property. That’s the experience Austin
and I want people, investors, Fools, members around the world, to get used to.
That’s what’s happening. These real estate markets and properties that
were only available for the very wealthy or the well connected, your rich uncle at the
golf club, that’s no longer the case. These platforms are out there for you to
make these investments and do it yourself. Hill: And we’re just getting started.
Argersinger: Just getting started! Hill: Go to real.fool.com to learn more.
Get that 40-page ebook, it’s free. Check it out at real.fool.com.
Thanks for giving us a thumbs up! Don’t forget to subscribe to our YouTube channel
so you don’t miss any of the live Q&A’s that we do. Austin Smith, Matt Argersinger,
guys, thanks for being here! Smith: Thanks, Chris!
Hill: Thanks so much for watching! We’ll see you next time! Fool on!

20 thoughts on “Real Estate Investing: How to Play the Housing Market Without Buying a House

  1. Me and my partner are in to real estate now and this video will definitely help us save on capital. Thanks for uploading. Watching now

  2. hi love your show but i have a problem with finding the websites you recommend this show I typed in Real.fool.com all i get is a list of pages or websites can you help me with this

  3. excellent analysis, i fully agree on the current risks of hospitality REITS because of heated competition from airbnb and booking, whereas I also invest heavily on healthcare REITs as the long term outlook is very good given the aging population. Well done fool I have been a happy subscriber for more than 10 years!

  4. Just to clarify is/are Mogul and million acres a product(s) of the Motley Fool that sells information about Investing? Or are these separate business entities? This video kind of seemed like an infomercial.
    Also, for the sake of disclosure are securities being sold (or marketed) by the aforementioned companies? If so are the securities registered and approved by the SEC or A recognized exchange like NASDQ or the New York Stock Exchange?

  5. Great video. But be careful with real estate crowdfunding. There bit of a craze or fad going on with this. I think smart investors are unloading their multi family and silmilar assets to individual investors at peak rents now. Plus lot of deals are being generated for fee's!! because it is become easy to raise capital. I don't know how many of these institutions are good or have any long term experience at managing multi family properties or CREs. Further who are these guys going to sell these large apt complexes or rather flip to after 5 years at higher prices. . It is easy to buy because so much capital is coming. Infact there is lot of competition to buy multi family assets, so this is great time to actually sell your apt building and buy a it back few years from same folks cheaper!! Most of them can fail in a recession and may not be able to refinance at higher valuation. All of this talk reminds me MLPs when OiL was going up in price. The biggest blunder of decade was MLPs are like toll or rent collectors and will keep yeilding great dividends regardless of Oil price. After Oil correction most of them have lost 60 or 80 of their value and some of big names have gone belly up!! I have personally lost money with MLPs. REITs today appears to be in same camp!! I still think it is better to buy real estate on your own and manage the rental on your own.

  6. I feel like I learned so much about REITs from this panel. Lots of questions that I had before were answered here, and I feel much more confident looking into REITs as an investment option. Thank you so much to the Motely Fool!

  7. Its amazing being into real estate & learning how it works…[email protected] the same time being from Brooklyn before it was hyper-gentrified. I know what happens to the people who cant afford to live in places when the housing market is "booming"…booming for who ??

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