Real estate investment is risky

Bud Hebeler of Analyzenow.com sent out a note about a presentation he gave at a real estate seminar. I'm a big fan of his website and conservative financial advice. He offers an important cautionary note at a time when I am hearing more and more people interested in getting back into the real estate speculation business. (It's a good time to look for a home, a primary residence; the caution is about real estate investing or speculation.)

The remainder of the presentations were from my friend who talked about his own experiences with investment real estate, followed by a local banker who talked about lending, followed by a real estate brokerage manager, and last a property manager.

The problem I saw was that you'd have to own many houses to reduce the risk within the real estate part of a portfolio. I'll stick with buying REITS when I feel it's time to get back into the real estate market--and I continue to hope that the last of my real estate partnerships will sell someday before I die.

I agree. The risk is far too concentrated for most people. Real estate investment trusts or REITS are a far more cost effective and sensible way to add real estate exposure.