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Younger investors should not miss out on real estate

California is home to some of the nation's most active and profitable real property markets, but many experts say that large numbers of the millennial generation are missing out on some excellent investment opportunities because they mistakenly believe that large capital reserves are needed. The information age has provided investors with tools like crowdfunding that allow them to add real estate to their portfolios even if they only have a few hundred dollars to spare, and the passage of the JOBS Act has opened up this opportunity.

Stock markets are generally active when economic indicators are positive, but share prices can plummet rapidly and without warning when investors lose confidence. Real estate offers younger investors a relatively secure hedge against this type of volatility, and this could provide them with confidence they need to trade stocks with purpose. Research indicates that cash currently makes up about 70 percent of millennials' portfolios.

Real estate also offers millennials a reliable source of additional income. Single-family homes can be renovated and sold for rapid profits or rented out to provide long-term cash flow, and these sources of income can be even more attractive with multi-family residences or small apartment buildings. However, investors of all ages should understand that real estate is not risk-free, and losses can be considerable for those who fail to do their homework.

Attorneys with experience in this area could help investors to avoid poor decisions by performing thorough due diligence. These efforts could include reviewing financial documents, ordering independent property inspections, verifying land use and zoning compliance and checking the bona-fides of sellers. Attorneys could also draft rental agreements and represent property owners should they become embroiled in any lease disputes with any of their tenants.

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