Jason Hartman is with us again to continue our discussion of the 10 Commandments Of Successful Real Estate Investing: #5.
Thou Shalt Not Gamble
Ganbling can be entertaining, and hopefully you limit yourself…but contrary to Lost Wages NV, real estate investing is the legitimate process of creating value over time.
Jason shares a simple way to know if you're an investor or a gambler/speculator – answer one question: does it produce income?
You want to invest for yield, cash flow, ROI…not capital appreciation.
In a cyclical real estate market, a “speculator” is taking the “buy low sell high” business route. Jason goes into the problem with this strategy: No one can sustainably and accurately predict the cycles in the real estate market.
Many gurus claim to be able to do this…but they're only good until they're wrong. A broken clock is right twice a day.
Jason ends with this directive: you'll need to focus on linear markets vs. cyclical markets in real estate to be an investor, not a gambler.