- Waller deemed competent to stand trial (1/11/17)5
- Young Elvis impersonator from Bernie performs on 'Ellen DeGeneres Show' (1/12/17)
- Two subjects of interest in 1992 homicide to take polygraph tests (1/15/17)8
- Business notebook: Jackson salon owner also opens a clothing store (1/16/17)
- Two men shot after argument; houses also struck by bullets (1/12/17)21
- 113 drug tests at Jackson High net one instance of illicit usage (1/11/17)15
- Cape SportsPlex contractor offers a look at the project (1/15/17)14
- Meat-processing plant faces $70K penalty for Clean Water Act violations (1/17/17)2
- Two Cape men recovering after shooting (1/13/17)
- Governor cuts $146 million, colleges take hit (1/17/17)
Some shift investments from stocks to real estate
CHICAGO -- Adam Slone got burned by the stock market. But his home and rental property stayed rock solid. So now Slone is out of stocks and into real estate.
"I think what everybody has learned is that none of us really understand the stock market right now. With all of the analysts getting into trouble, you don't know who to trust, not to mention with all of the corporations getting caught," said Slone, owner of a Washington-based health care recruiting company. His stock holdings have lost nearly half their value.
Whether it's a new home or a real estate investment trust, many investors shaken by the uncertainty of Wall Street are putting their money into property.
The National Association of Realtors reported that sales of existing homes in May were running at an annual rate of 5.75 million, the fourth-highest monthly level on record.
According to Merrill Lynch, between Jan. 1 and last week, investors put an additional $2.7 billion into real estate investment trusts, or REITS, which are companies that invest in real estate holdings. The figure is a huge leap from $34 million for all of last year.
The strong real estate market is attributed to the relative stability of real estate as well as some of the lowest mortgage rates in at least three decades. Thirty-year fixed mortgages are around 6 1/2 percent
Chicago real estate agent Mike Langland said last week that the area real estate market is showing no signs of slowing down. "Our business has probably doubled from last year and last year was a very good year," he said.
Developers are gobbling up land on Chicago's South Side as more people are interested in buying homes, Langland said.
Residential sales also are up in California, where the real estate market slumped after the dot-com collapse.
"As we saw the downturn, we started to see a shift of dollars into real estate as it was the safe haven," said Robert Bailey, president of the California Association of Realtors. "Now it's a better long-term place to put your money as far as the investment stand point."
While the slide on Wall Street is eroding many people's savings, it may not necessarily knock the legs out from under the real estate market, said Lawrence Yun, an economist at the National Association of Realtors.
He said first-time buyers often do not have their down payment money invested in stock market. And he said that second-home buyers who invest in stocks tend to have diversified portfolios and have already shifted more of their investments into real estate.