There's a Reason Why the Best Real Estate Investments Are Boring

Boring isn’t bad. In fact, boring is just what real estate investors need.

Our culture, whether through real estate “gurus” or rose-tinted HGTV glasses, likes to make real estate investing seem like this incredibly exciting endeavor. Listen: there’s plenty to be excited about when you invest in real estate. You don’t need excitement from hype or the danger of taking a risk.

As a rule, boring is best in this business. Instead of going after the hottest markets and high-stakes deals, go for the reliable stuff.

Exciting? No. Peace of mind? Yes.

We'll Give You 5 Reasons to Buy "Boring" Real Estate

Reason #1: You'll never be blinded by hype or FOMO

Ever make a decision on an impulse and immediately regret it? It’s okay when we’re talking about eating a Snickers bar (or three) but not so much when we’re talking about buying real estate.

We won’t say it’s bad to be excited about your investments. But it is bad to be excited only because of outside hype. When you stay focused on making investments that offer steady, reliable returns, you’ll be less prone to fall for the glitz and glam of the hottest new market or model. Remember: by the time you hear about it, it’s probably not worth investing in!

Tried and true methods aren’t the most thrilling, but they get results.

Reason #2: You'll actually assess opportunities objectively 

Investing in real estate should not be an emotional endeavor. Getting too excited about a market, a property, or any opportunity means you’re less able to consider it from an objective standpoint. You need that objectivity, that reliance on real numbers and data, to ensure that the decision you’re making is a wise one. Boring investments are predictable. You know what you’re getting. Not only is this inherently less risky, but it allows you to see opportunities for what they really are. No bells and whistles.

Reason #3: You'll create a solid foundation 

We’re not saying you should never pursue a thrilling investment opportunity. What we are saying is that every investor must start with a solid, reliable foundation before they engage in riskier investing. You want the bulk of your portfolio to create a safety net. That safety net comes from predictable value, both in terms of cash flow and appreciation.

When your portfolio isn’t tossed around by shifting economic conditions or beholden to tiny windows of opportunity, you’ll find yourself free to pursue a diverse range of investments with the cushion to absorb the effect of any duds in the bunch.

Reason #4: You'll secure peace of mind

Investors, don’t underestimate the value of peace of mind. When you’re a passive investor, you don’t want your day to be full of putting out fires, investment worries, or constant market-watching. Even if you’re an active investor, we doubt you want that, either!

Peace of mind comes from knowing you’ve built something you can rely on. Your properties are going to generate steady income, appreciate, and slowly but surely help you establish lasting wealth. It doesn’t happen overnight, but it doesn’t have to. In this business, speed is volatility. If what goes up must come down, you want your properties to take their sweet time going up.

Think about it this way: when the Great Recession hit, do you know what real estate market fared the best and bounced back the fastest? Houston, Texas. At the time, Houston didn’t have the same level of buzz we see today. But it was a market with a diversified local economy and affordable real estate.

It wasn’t overinflated like so many big markets at the time. As a result, when the market collapsed, Houston didn’t have as far to fall. A smaller impact meant a smoother, faster recovery.

Think of your portfolio in these terms, too! You want assets that will weather any storm they encounter.

Reason #5: You'll withstand market fluctuations

Speaking of storms…

The real estate market moves in cycles. We know this. Certain types of investors need to be diligent about timing the market. Their profits depend on getting the right deal at the right time and selling when profits are maximized.

Passive investors don’t have to worry so much about timing the market because their investments work regardless of the stage in the market cycle. While things like inflation and recession do have an impact, they won’t tank your portfolio. It’s part of being a buy-and-hold investor!

It may not be fast-paced and exciting, but it’s reliable. And in the face of uncertainty and toughening market conditions, reliability is what we all need to lean on.