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Short Term Investment Strategy Considerations | International Residential Real Estate Investors Association
Wednesday July 26th 2017

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Short Term Investment Strategy Considerations

The other day an appraiser friend of mine explained that in his opinion the economic situation offered uncertainty and questions as far as the eye can see.  Because of this he concludes any investment offering a short term turn should be taken and moved aggressively from closing to cash out.  He also concludes from his appraising work many opportunities exist.

This advice resonates positively with me.  As I see the Federal Reserve moving toward considerable additional qualitative easing and the U.S. 2011 budget taking shape over the next couple months, opportunity exists for this approach.

Looking further out into the future, I’ve seen a number of issues to consider:

  • Global consumer spending patterns especially in China and the other Tigers is out of proportion and aggressive action isn’t developing to resolve this.
  • The U.S. government is entering a period of long term budget “austerity” beginning in 2012.
  • The United States still has 10% to 15% too many banks licensed and the current failure rate is resolving this quickly enough.
  • When the Fed ends the period of easing rates, are positioned for dramatic increases.
  • The new housing market norm is still being digested by the economy and the “shadow” inventory  shows this will require another 3.5 years.
  • Employment growth is anemic and not likely to change.
  • Consumer debt reduction and spending constraint will remain in place for years.
  • The U.S. is no longer the only economic game in town and this is creating uncertainty because the definition of this change is difficult to comprehend.

So, for now, get while the getting is good has new meaning.

Blake Ratcliff

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