Welcome Back Risk
April 19, 2010
For the past few months, it seems the bears have taken a back seat to a lot of bullishness, particularly in commercial real estate. A few months of rising prices, equity flowing everywhere, and a whole lot more buyers than sellers has made many investors feel that perhaps we’ve seen the worst of it.
Perhaps we have. But that doesn’t mean the world is fundamentally that different than it was just 6 months ago. Interest rate risk still looms, deficits, budgets, and government woes still abound, and unemployment and consumer spending continue to be a major concern. The first time home-buyer tax credit is also set to expire shortly as well.
Take the time to factor in what could happen to tax rates on dividends next year if action is not taken, and continued pressure by both local (a la Palo Alto) and federal authorities to tax rents and other forms of investment income, and you’ll realize risk never really left, it just took a short nap.
Similar Posts:
- Laugh or Cry? 4-Year Old Buys A House
- Fixing The Fundamental Problem
- Unemployment Benefits and Homebuyer Tax Credit Extended
- Tax Credits and The Law of Unintended Consequences
- Prudential’s Case for CRE
Risk is always going to be prevalent – especially in the commercial real estate industry. Interest rates will most likely begin to rise and unemployment will most likely remain around 9-10% in some areas. However, you can still make some solid investments in the CRE industry – just have to know where to look.
taxing rents is a terrible idea. i dont see it doing much for those certain properties in AZ. just such a lame idea and stupid way to get a few bucks out of people.
Wow this is a great resource.. I’m enjoying it.. good article