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Anyone interested in a pure equity appreciation investment?
November 30, 2014
By pure equity appreciation, I mean something like making a long term investment with no distributions, but instead focus on capital appreciation. I think it would need to be 5 years or more with the goal of doubling your investment every 5 year period.
This type of real estate investment was popular some years ago and some of our older investors have done very well with it. However, when the last recession hit, even those who still had the ability to invest, got a bit nervous and preferred to invest in projects that provided an annual distribution.
I thought it is time to revisit this option. Here is my take on the two types of investments
It’s not like one is more superior to the other. It is more about what works for you.
The pure equity appreciation option is great for those who have stable employment, business or other regular income.
However, if you were retired and needed all your capital to produce current income, or if most of your capital was very dependent on current interest rates, you may want to stick to an investment with distributions.
Pure equity appreciation is also a good option for those who are fortunate enough not to need the income OR the capital in their life time. Don’t mean to be morbid, but in this case, your children (or other heirs) can receive a significantly appreciated asset where you and they avoid capital gains tax completely.
Anyway, I am just trying to get a feel for how much interest there is in this, so I would appreciate it if you would send me your thoughts. I know everyone is busy, so even if you say Yes, No, or Maybe in your email, that will help.
Obviously, I am not expecting any kind of commitment. I’m not going to hold it against you if you change your mind! You can reach me at email@example.com