More good news in the housing market from John Paulson, Hedge Fund manager

Entry July 22, 2013

More good news in the housing market. Popular and successful
financial analysis, John Paulson, now says that buying a home is
a good investment. He thought it a bad investment back in the
time of subprime mortgage disaster, but he is back on the
"home ownership" band wagon. He says if you already own a home,
but a 2nd one. Maybe that 2nd home (or even your primary
home) should be in the country. Let us know when we can
show you a country home!

To see original article on CNN, click link below.

http://buzz.money.cnn.com/2013/07/17/john-paulsons-housing/?iid=HP_River.

The Buzz

All markets and investing news all the time

John Paulson's advice: Buy a house

John Paulson made billions betting against subprime mortgages. Now, he says 

buying a house is the best possible investment. If you already own a home,
buy a second one. "You won't make returns that good by investing in me,"
Paulson told the audience at CNBC's Delivering Alpha conference 

in Manhattan on Wednesday. Paulson said that back in 2006, he was
aware that housing was at its peak. Now, he thinks it's still very close to
the bottom. "I think we're just at the beginning of the recovery.
I think it will continue for four to seven years," he said.
"It's not too late to get involved."

For the individual investor, locking in a fixed-mortgage rate is also a
way to hedge against inflation down the road. He thinks it's unlikely
that an uptick in mortgage rates will cause the housing market to cool.

Paulson's hedge fund, Paulson & Co., has been betting big on housing
for more than a year. He says his fund has likely been the
largest purchaser of undeveloped land in Arizona, California,
Florida and Nevada this year. He expects the price
of such land to increase precipitously, since he thinks there's
not enough inventory to meet the coming demand for new homes.

See remainder of article at this link, relating to gold as an investment@
http://buzz.money.cnn.com/2013/07/17/john-paulsons-housing/?iid=HP_River.

Home Prices Improve, best since 2009

Entry June 26, 2013

Post as to Improving Home Prices so far this year

June 20, 2013, 11:52 a.m. EDT

Existing-home sales highest since 2009

By Ruth Mantell, MarketWatch

Existing-home sales in May were up 12.9% from the same period in the prior year — the largest growth since October 2011. Meanwhile, year-over-year median prices rose 15.4% in May,
the largest growth since 2005.

WASHINGTON (MarketWatch) — Existing-home sales rose in May to the highest pace
since November 2009, when buyers were rushing to make a tax-credit deadline, pointing to a continuing recovery, the National Association of Realtors reported Thursday.

Existing-home sales rose 4.2% in May to a seasonally adjusted annual rate of 5.18 million. These sales were
12.9% higher than during the same period in the prior year. Economists polled by MarketWatch had expected the pace of existing-home sales to hit a rate of 5 million in May, compared with an April rate of 4.97 million.“This report provides further evidence that the housing market is on a firmly improving trend,” wrote analysts at RDQ Economics in a research note.Meanwhile, the median existing-home price hit $208,000 in May, the highest since 2008, with low inventory supporting prices. The median price is up 15.4% from the same period in the prior year, the largest growth since 2005.

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Inventories rose 3.3% in May to 2.22 million existing homes for sale. The supply of existing homes
declined to 5.1 months at May’s sales pace from 5.2 months at April’s sales pace.
The share of the sales accounted for by distressed properties and first-time buyers remained low in May.

Analysts say the housing market’s gains over the past year could have been even larger if inventories were greater Still, economists expect housing demand to continue to grow along with the U.S. economy.

As home prices continue to rise, more buyers are likely to be able and
willing to put their homes on the market.

Rising prices also induce buyers to bid before prices get too high. However, NAR
said prices are rising too quickly and more construction is needed.

Bloomberg

Existing-home sales rose 4.25 in May and home prices climbed more than 15% year over year.

Low interest rates have been fueling demand. In recent weeks these rates have trended higher, though there was a recent decline. While rising rates will curb demand among
some buyers, they could also spur others to quickly enter the market to take advantage of high affordability.“Given the massive rise in mortgage rates in recent weeks, we expect the pace of positive momentum will likely slow in the coming months, though the initial reaction could be for some buyers to move into the market as they try to lock-in the lower mortgage rates,” wrote Millan Mulraine, director of U.S. research and strategy at TD Securities.Despite their recent climb, rates remain relatively low, as Federal
Reserve Chairman Ben Bernanke pointed out Wednesday.

“In terms of monthly payments on an average house, the change in mortgage rates we’ve seen so far is not all that dramatic,” Bernanke said at a press conference following the central bank’s decision to leave policy unchanged.Indeed, Americans’ views on the housing market recently hit a multiyear high, with large shares
saying that now is a good time to buy and sell homes. However, recent price gains don’t necessarily signal that real estate is a good long-term investment, according to Yale economist and housing expert Robert Shiller.Ruth Mantell is a MarketWatch reporter based in Washington. 

Follow her on Twitter @RuthMantell.

 Welcome to the ETX Country Roads Blog for
The Country Connection, in Canton, TX

We hope you will come back often to see what is happening in and
around Canton,  and the rest of North East Texas!

Entry June 5, 2013

BBC Post on why so many people are moving to Texas
By Tom Geoghegan BBC News, Washington  May 30, 2013

10 reasons why so many people are moving to Texas Comments (377) By Tom Geoghegan BBC News, Washington Half of the 10 fastest-growing cities in the US are in Texas, according to new figures. Why? Every way you look at it, there are a lot of people moving to Texas. Five of the 10 fastest-growing cities in the country between 2011 and 2012 were in Texas, according to new figures from the US Census Bureau. New York is way out in front in terms of added population, but Houston is second with San Antonio and Austin fourth and fifth. In terms of percentage growth, it's even more Texas, Texas, Texas. Among the five cities that grew most, as a proportion of their size, between 2011 and 2012, three are Texan. San Marcos is out in front with the highest rate of growth among all US cities and towns - 4.9%. Some of this Texan population boom is due to a natural increase - more births than deaths - but the numbers moving into the state from elsewhere in the US and from abroad far outstrip every other American state. Why? 1. Jobs "I don't think people go for the weather or topography," says Joel Kotkin, professor of urban development at Chapman University in Orange, California. "The main reason people go is for employment. It's pretty simple. Continue reading the main story Most new arrivals 2011-12 Texas: 210,590 N Carolina: 60,106 Virginia: 40,844 "The unconventional oil and gas boom has helped turn Texas into an economic juggernaut, particularly world energy capital Houston, but growth has also been strong in tech, manufacturing and business services." Critics have questioned whether the "Texas miracle" is a myth, based on cheap labour and poor regulation. But Kotkin says Texas has plenty of high-wage, blue-collar jobs and jobs for university graduates, although people looking for very high-wage jobs would probably head to Seattle, San Francisco and New York. Four of the top 10 metropolitan areas for job growth in 2013 are in Texas, according to Kotkin's website, New Geography. Texas also has a huge military presence, which grew as defence spending increased in the decade after 9/11. Many retired Texans first came to the state as service personnel. 2. It's cheaper Once employed, it's hugely important that your pay cheque goes as far as possible, says Kotkin. Continue reading the main story Fastest growing cities in US (%) 1: San Marcos, Texas (4.91) 2: South Jordan, Utah (4.87) 3: Midland, Texas (4.87) 4: Cedar Park, Texas 4.67) 5: Clarktown, Tenn (4.43) 6: Alpharetta, Georgia (4.37) 7: Georgetown, Texas (4.21) 8: Irvine, California (4,21) 9: Buckeye, Arizona (4.14) 10: Conroe, Texas (4.01) US Census Bureau, 2011-12 "New York, LA and the [San Francisco] Bay Area are too expensive for most people to live, but Houston has the highest 'effective' pay cheque in the country." Kotkin came to this conclusion after looking at the average incomes in the country's 51 largest metro areas, and adjusting them for the cost of living. His results put three Texan areas in the top 10. Houston is top because of the region's relatively low cost of living, including consumer prices, utilities and transport costs and, most importantly, housing prices, he says. "The ratio of the median home price to median annual household income in Houston is only 2.9. In San Francisco, it's 6.7. "In New York, San Francisco and LA, if you're blue-collar you will be renting forever and struggling to make ends meet. But people in Texas have a better shot at getting some of the things associated with middle-class life." Continue reading the main story Texans who've left their mark on the world Roy Orbison (pictured, first) was born in the small town of Vernon, in 1936, months before fellow rock 'n' roll great Buddy Holly, from nearby Lubbock Joan Crawford(second), born Lucille Fay LeSueur to a poor San Antonio family, was famous for accepting an Oscar while ill in bed As JR Ewing, Fort Worth's Larry Hagman became the face of long-running soap Dallas and just about the most famous man in Texas Also robbers Bonnie and Clyde, singer Janis Joplin, country star Willie Nelson, cyclist Lance Armstrong, actress Jayne Mansfield(third) Texas has produced two presidents: Lyndon Johnson and Dwight Eisenhower. Connecticut-born George W Bush (fourth) grew up there 3. Homes Land is cheaper than elsewhere and the process of land acquisition very efficient, says Dr Ali Anari, research economist at the Real Estate Center at Texas A&M University. "From the time of getting a building permit right through to the construction of homes, Texas is much quicker than other states. "There is an abundant supply of land and fewer regulations and more friendly government, generally a much better business attitude here than other states." This flexibility, plus strict lending rules, helped to shield the state from the recent housing market crash. 4. Low tax Continue reading the main story 'I moved because I had to' Jeff Paradise, 32, works for an insurance company and relocated to Dallas in 2011, but he often returns to see his partner, Ryan (above left), in his native New York. "I've been to quite a lot of cities in the US and Dallas is probably my least favourite. The one reason I'm here is for a financial purpose. I have a really good job but I work about 70-80 hours a week so if I had more free time, I would do more. It's a new American city, all sprawled out, because it came of age in the 60s and 70s when it was all about cars and highways. But it's definitely changed the last 5-10 years and they are trying to improve the public transport. I get the train and it's clean, on time and cheaper than New York." Texas is one of only seven states where residents pay no personal state income tax, says Kay Bell, contributing tax editor at Bankrate and Texan native. The state has a disproportionate take from property taxes, which has become a big complaint among homeowners, she adds. But overall, only five states had a lower individual tax burden than Texas, according to Tax Foundation research. There are also tax incentives for businesses and this week legislators cut more than $1bn off proposed business taxes. 5. Pick your own big city Texas has six of the country's 20 biggest cities, says Erica Grieder, author of Big, Hot, Cheap and Right: What America Can Learn from the Strange Genius of Texas. Contrast this to, for example, Illinois, where if you want to live in a big city you can live in Chicago or you have to move out of state, she says. But if you're in Texas you can be in Houston, San Antonio, Dallas, Austin, Fort Worth, or El Paso. 6. Austin in particular Continue reading the main story Why I live in Austin "Houston is a city, San Antonio is a city but Austin doesn't feel like that to me," says Texan-born folk singer James McMurty. "I like it because it's equidistant to each coast so I can get in my van and drive to the west coast and drive around there for three weeks and then come home and do the same on the east coast and still have a life. "It's far enough south that it doesn't get too cold and you don't get many twisters. And it's a blue dot [Democrat] in a red sea." Restaurant manager Christopher Hislop, 33, moved in 2007 from Los Angeles to Austin, where he met his wife and they now have a nine-month-old boy. "I came to Austin for a wedding and thought it was a really cool city and the people were nice - it was everything that LA wasn't but still had that hip vibe without pretension. The nightlife is great and there's an emphasis on getting out and about - they maintain trailways and nature. "It's not Texas at all and that's what I liked about it. I don't know Texas very well, I grew up in Chicago, but Austin is not Texas because you think of 10-gallon hats and guys on horseback. It's a cliché but Austin isn't like that, it's hip and in the now. The rest of Texas is very conservative." People like to perpetuate a myth that Austin is still the Austin it once was, says Joshua Long, author of Weird City: Sense of Place and Creative Resistance in Austin, Texas. So as it's become a big city, a movement has developed to "keep it cool, keep it weird and keep it environmentally friendly". 7. Family-friendly Because of its good-value housing, Texas has been particularly popular with families, and some of its cities now have an above-average number of children. San Antonio is home to the largest community of gay parents. In Texas, you can have a reasonable mortgage and pretty good schools, says Grieder. And restaurants are invariably family-friendly. "You hear about the high drop-out rate but Texas education scores pretty well at national tests for 4th and 8th graders in math, reading and science. The aggregate is about average. "The perception is that Texas has poor schools but it's not correct. Across the country in general, we don't have schools as good as we would like them to be." In eighth-grade maths, for instance, Texas scored higher than the national average and outscored the three other big states of California, New York and Florida. On Sunday, an education budget was approved that restored cuts made in 2011. 8. Fewer rules Continue reading the main story And why some might not move to Texas The weather - summer is hot. Very hot Congestion problems growing in big cities Not well known for fun nightlife, outside Austin If you hate American football (above, University of Texas Longhorns), you might be outnumbered "Texas is liberal in the classic sense, it's laissez-faire, so there's a lack of regulations," says Grieder, and this can apply to the obvious (business regulations) or the less obvious (city rules). "The classic social contract is - we're not going to do a ton to help you but we're not going to get in your way. That's not 100% true of the state but there's that strand in the state." Mortgage lending is an obvious exception. But there has been strong opposition to banning texting while driving and a proposed tax on soda. And Governor Rick Perry is poised to sign off the strongest email privacy laws in the US, which would require state law enforcement agencies to get a warrant before accessing emails. 9. Texans are normal people The state likes to proclaim itself as an unpretentious, down-to-earth place where people are easy to get along with. As John Steinbeck wrote: "Texas has a tight cohesiveness perhaps stronger than any other section of America." And for people with conservative values, it could be a natural home, although demographic shifts have prompted speculation it will be a Democratic state in the future. People dream about moving to California, but they don't dream about moving to Texas, says Grieder, yet many of those reluctant to move there end up liking it. She adds: "[They] realize that Texans aren't all Bible thumping, gun-toting people. The job is the trigger to come but you find it's pretty nice to live here." 10. And they're not going anywhere All this doesn't just bring in new arrivals - native Texans aren't leaving the state either. It is the "stickiest" state in the country, according to the latest figures from the Pew Research Center, which suggest that more than three-quarters of adults born in Texas still live there. Alaska is the least sticky.

Entry February 21, 2013

We have been seeing signs of a real estate recovery in our own area since the end
of 2012. We are getting more calls and showings plus we have been writing
offers. Is the recession over...? No way we can say what will be coming in
the next months or  years. All we have is "recent experience". This has
been up on some blogs and seems to be a credible prediction based
on our activity here.

How "Real" is the Real Estate Recovery for 2013
from Merrill Lynch Associates 

Entry January 3, 2012

Texas' Private Sector Job Growth Outpaces Nation's

COLLEGE STATION (Real Estate Center) – Texas gained 227,800 nonfarm jobs from November 2010 to November 2011 according to the Center’s latest Monthly Review of the Texas Economy. That represents an annual growth rate of 2.2 percent compared with 1.2 percent for the United States.

The state’s non-government sector grew at an even faster rate, adding 292,700 jobs (3.4 percent) compared with 1.7 percent for the nation’s private sector.

Texas’ seasonally adjusted unemployment rate fell to 8.1 percent in November 2011 from 8.3 percent the year before. The nation’s rate decreased from 9.8 to 8.6 percent.

All Texas industries except the information industry and the state’s government sector had more jobs than the same time a year ago. The state’s mining and logging industry ranked first in job creation, followed by the professional and business services industry and the leisure and hospitality industry.

Read remainder of this blog entry about job growth
and how it effect real estate at this link:

 

Entry March, 2011

Spring is in bloom in East Texas.  Come out and enjoy the beauty!

Entry March, 2011

 Snow views around our home for the early January snow!

 There's no place like "Home for the Holidays", especially if the home is
 in the country in Northeast Texas!  The icicles are on the office in
 Downtown Canton.  Just a few days of ice and snow per winter. 
 Great place to live!

Entry September 27, 2010

Visit Van Zandt County in the Autumn.  You'll want to stay forever!

85 Years of Service

Entry September 2, 2010

We want to share remembrances of the 85 years of United Country,
formerly United Farm Agency. We share these memories from
our home office from their Blog entries.

Celebrating milestone sales
the United way

by ucrealestate on August 27, 2010

United’s founder, Roscoe Chamberlain, had a generous spirit that was recorded in many stories in the company’s record books. One story, however, was so monumental that it caused a national media frenzy.

Chamberlain was so proud of United Farm Agency’s accomplishments and so full of gratitude to the many loyal customers who contributed to the company success that he eagerly awaited the company’s 50,000th sale milestone and spent years planning for the event.

That milestone was reached in November 1955 when Bob and Aleene Sells and their seven children received their new 80-acre farm in southeast Missouri for free as a gift from United Farm Agency.

Cheryl Jacks, a 48-year employee of United, and the only current employee with the pleasure of meeting Mr. Chamberlain in person, shares the story of the 50,000th sale in the video below.

The company continued Chamberlain’s tradition for many more years by celebrating major milestones along with way.

In 1965, the company reached its 100,000th sale. After years of flipping through United Farm Agency catalogs, Col. G. E. Brown, U.S. Army, and Maj. H.A. Mott, U.S. Army, purchased a 150-acre tract in Athens, Texas. The gentlemen had plans to improve the property and were thrilled when they learned that United Farm Agency would be paying the entire cost of a full carpet of Bermuda grass for the land, to celebrate the company’s milestone.

United’s 200,000th sale was recorded in October 1974 when the company presented a brand new Ford Country Squire to Mary Alice Lawson and Elizabeth Kenney to put to use for their business, Humpty Dumpty Nursery School.

Four years later, in 1978, the company celebrated the 250,000th sale by treating Ray and Brenda Hamilton, who had purchased a 160-acre dairy farm in Lebanon, Mo., to a property makeover complete with the painting of the home and all outbuildings, tilling of the fields,
and the use of an express moving van service, compliments of United Farm Agency.

Help us celebrate 85 years of service by calling us to help you find your perfect property in North East Texas!

Retirement Land Investment

from

You Can Invest in Land with a
Self Directed Retirement Account

You can invest in Land, improved or unimproved with a “Self Directed Retirement Plans” since the IRS has allowed them. No one wants to talk about it. “They”, the investment firms do not make money on a Land transaction because “they” are not licensed real estate agents. Only licensed real estate companies can take commissions and are not allowed to pay referrals except to other active real estate firms. The traditional investment community has had control of over 97% percent of the retirement accounts and they have been making a great living off your hard earned money.
Your stock broker or financial advisor will not advise you how to take money away from their pockets and invest in real estate through your IRA, or 401K plan either. The financial magazines run large ads for brokerage firms and mutual funds T.V. and radio investment shows are supported by the same Wall Street advertising dollars…your money. I would be curious to see how many investment magazines will publish this article or if any investment shows will address this topic.
Stated on the IRS website “…..because of “administrative burdens”, many IRA trustees do not allow IRA owners to invest IRA funds in Real Estate. IRA law does not prohibit investing in Real Estate but trustees are not required to offer Real Estate as an option.” No commission for real estate sales may have a say here described as “administrative burdens”.
An Individual Retirement Account is a personal savings plan that allows you to set aside funds for your retirement. Investments made within these plans grow in either a tax-deferred or tax-free environment.
The IRS allows your IRA to earn tax free or tax deferred income with NO limitations on how much you receive—you can earn thousands of dollars with no tax consequences. A “Self-directed IRA” will allow you to choose your own investment strategies to earn significantly more for your retirement.
The term ‘self-directed’ does not actually have any legal connotation. It does not imply a different type of IRA, or a separate set of IRS rules. ‘Self-directed’ is simply an accepted industry term indicating that the IRA custodian is allowing the IRA owner greater control over their investment decisions. When an IRA account is self-directed, the IRA owner makes all of their investment decisions and instructs the custodian to act. You must have a custodian as a third party administrator.
Be careful who you choose as your custodian. Most of these “professionals” are part of the same old 97% controlling crowd previously mentioned. Our recommendation is that you find one that charges an administration fee and believes in Land Investments.
Traditional IRAs, SEP IRAs, Roth IRAs, 401(k)s, 403(b)s, Coverdell Education Savings (ESA) a.k.a. Educational IRAs, Qualified Annuities, Profit Sharing Plans, Money Purchase Plans, Government Eligible Deferred Compensation Plans, Keoghs are qualified plans that can be converted into “Self-directed Retirement Plans”. For more detailed information visit the Internal Revenue Service’s website. Also see Publication 590. On pages 40-41 you will see what investments are not allowed. Land is not included and therefore qualifies as does other types of real estate investments.
Our recommendation is to Stay away from investing your IRA money into an S corporation. S corporations only allow individuals (not entities) and certain permitted trusts to be investors. So if your IRA (an entity) is the investor, the S Corp would lose its status and its tax rate would change to a potentially less favorable one. Roth accounts can be used but take time to accumulate larger funds portfolios.
When purchasing Land with funds coming from an IRA, remember that the IRA itself must purchase the Land and hold the grant deed. All property taxes for that Land must also be paid from the IRA. The self-directed IRA should be opened first with cash or funds rolled over from other IRAs, 401ks, retirement plans, and then the Land should be purchased. Large tax penalties can occur if these transactions are not done properly. Proper care in deciding when to sell or lease the Land is also important. Land, especially pre-developed Land, is a long-term investment and often needs to be held for a minimum of five to seven years to produce the highest returns.
You can leverage a Land purchase with as little at 15% down and amortize 20 years with Farm Credit. They are located throughout the United Sates with different names. In the Land Brokerage business they are called “The Land Bank”. Farm Credit has had the most consistent programs for Land investors. Because of your increased buying power when you use leverage, the profits you make from the ability to use leverage can greatly outweigh the tax associated.
For more information we also recommend you visit, IRAAA™ is a nonprofit education-oriented alliance of financial planning, real estate, legal, banking, investment, and accounting professionals interested in further developing the niche industry of Self-Directed IRA & 401(k) investing. Their Promise is “IRA Association of America aims to provide affordable, unbiased and comprehensive education on the topic of investing with a Self-Directed IRA or Solo 401(k)”.
Make sure that you Google “Self Directed Retirement Accounts” and other associated words. Do your homework. This article’s sole mission is to stimulate your creative juices and reveal part of this untold story. After all you be in control of your own destiny and have the benefits of being a Land Owner. The greatest freedom there is.

Happy 4th of Julyl!

A very Happy 4th of July
to all our Friends!

May you enjoy the holiday weekend

and remember to give thanks for

the men and women of the US

Military for protecting our Freedom!

Enjoy this beautiful tribute to America with this
video America the Beautiful!

LandThink

Today we bring you a copy of an article from "LandThink"
about investing today as a hedge against inflation. Rural
land is about the only investment you can make that
you can thoroughly enjoy for years in the future,
while watching it grow in value. It is NOT a consumable
commodity. If you are looking for a good investment
in this recession, look to land. Give us a call for
more information about owning a piece of East Texas!


Land hedges both inflation and systemic risk

On Thursday, May 6th, the Dow Jones Industrial Average fell almost 1,000 points, a little more than nine percent, in 16 minutes, and no one knows why. At day’s end, the DJIA was down only 342 points, and everyone didn’t think that was too bad…considering the place it had visited.

Fingers of possible blame pointed in many directions—Greeks bearing debt, Jihadist glitches, automatic computer-trading programs, a trader’s “fat-finger” mistake, jitters about financial-reform legislation, too much sugar in Wall Street’s afternoon power drinks, a Madoff mole wreaking revenge.

A thousand point drop got me to thinking.

I’d been talking to my daughter, Molly, a few minutes before the DJIA’s dipsy-doodle. She works on the speed desk at Bloomberg News in Manhattan, feeding headlines and financial news into the company’s terminals. She’s up to the minute on this stuff; I’m a lagging indicator, often intentionally so. We were talking about the future and how to prepare for it.

I said I thought people in their 20s and 30s were going to have a much tougher time earning livings and preparing for retirement than Baby Boomers, because the global financial system — and the American end of it, in particular — seemed increasingly volatile, increasingly fragile and increasingly vulnerable to system-breakups, from both internal and external sources. System risks, in short.

This got me thinking about hedges.

Gold is often touted as a hedge against inflation. But when I looked at gold price and the Consumer Price Index, I saw that inflation had risen with reasonable consistency year to year while gold was volatile—spiking in 1980 and during the last several years, but lagging the CPI for most of the years in between. One study I reviewed showed the average annual rate of return on gold between 1979 through 2008 was 5.37 percent, most of the gain coming during the last decade, compared with stocks at 11.9 percent, 3-month T-bills at 5.9 percent and rare coins above 10 percent.

Gold is a fear purchase, not an inflation hedge. If you think it’s likely that the world will fall apart, you put gold in your bedroom safe so you can buy guns and toilet paper. If that time comes, inflation will have solved itself through collapse.

Gold doesn’t behave like a commodity, because people buy it for reasons other than consumption and utility. It’s a non-renewable resource like oil, but it doesn’t get used up like oil, coal and natural gas. It seems to me that people use it as a financial worry bead, fingering it more in times of high stress.

When Molly set up her retirement account last year, I gave her the conventional advice about index funds and broad baskets of stocks and bonds. But what I wanted her to do was to set up a real-estate IRA to buy land, which she couldn’t do.

An inflation hedge should track inflation…and do a little better.

Between 1999 and 2009, the average annual inflation rate has been 2.6 percent. For the 10 years preceding, it was 3 percent.

It’s difficult to measure national returns on timberland investments, because tracts vary so much in size, management, types, length of ownership and other factors. The database at the National Council of Real Estate Investment Fiduciaries is widely used for comparing investments, but it’s skewed toward large tracts and tax-exempt investors, primarily pension funds. The same bias is found in NCREIF’s farmland index, all of whom are tax-exempt investors.

Nonetheless, the NCREIF average annual timberland return in the 20 years between 1990 and 2009 was 2.76 percent. The average annual return for farmland between 1992 and 2009 was 2.74 percent.

Using the NCREIF indexes, farmland and timberland returns did a bit better than inflation during the last two decades. These types of land investments as measured by NCREIF are reasonably good inflation hedges.

A 2009 study from Jeff Mortimer at J.P. Morgan Investment Analytics & Consulting found that timberland “…has provided an annualized return of 14.60%…” over the past 22 years while correlating “highly with inflation….”

Looking ahead, I see nothing that would suggest that stocks and gold are getting less volatile, and the financial system in which they function seems to be looking more vulnerable, more risky. Whether systemic risk is reduced in the future is anybody’s guess; mine is that it will not.

Gold may be the coin of last resort, but short of total collapse, farmland and timberland appear to be better hedges against both less-than-catastrophic events and inflation. If nothing else, land prices will appreciate due to population growth over the long term. And if the toilet-paper choice is between gold bars and leaves, well….

LandThink is a knowledge base for land investors and sellers to learn about and discuss the various aspects of land investing, selling, ownership, and trends in land real estate. Get Land Smart!

Related Articles
Timberland investing: Risk and reward in the woods
Stocks vs. land: Which is the better investment?
Investing in Land: True Value

Watch for more articles about real

estate in East Texas...

Memorial Day Project

Enjoyed the Memorial Day weekend around
our house (which is for sale). That means
there is always something that needs doing.

If you are looking for a ground cover, you should
look into Grape Ivy. It is planted in just a pot
out in the flowerbed, but as you can see it has
taken over. That makes it a great ground cover!

After a normal weekend of cleaning up around the house,
taking calls and showing property, we used Saturday
morning and Sunday morning to give the storage
barn a new lease on life. After power washing,
the old paint was just about naked, so I think the
old girl really enjoyed this first coat of
"Red Hot" barn paint! She will need a
2nd coat, but looks much better after the first
one. A little rebuilding on the doors and a 2nd
coat, and she will look great again!

Even the leaves were painted
in this "red for all" weekend!

Happy Memorial Day to all our
Friends and Family!
There is no country in the world
which can match the United
States for Freedom and the
Pursuit of Happiness!

We give thanks for every man and woman
serving in the military, protecting
our way of life, and especially
for those who made the ultimate
sacrifice for their country!

Doggies play at the pond

Continuing the joys at the pond over the weekend with the
doggies and their favorite babysitter, the downed tree...

Brat (Bratwurst Von Lick'um Steins) is the alpha dog,
hyperactive and inquisitive. Doozie (Shepherd and
Catahoula) is the quiet 2nd child, strong, fast, but
timid and terribly afraid of storms

Beautiful yellow aquatic plant flowers at the end of the pond

Mother's Day weekend by the Pond

Mother's Day has passed but the joy of living in
East Texas never gets old. We had the kids out for the
weekend and enjoyed the time outside and time
by the pond playing with our family dogs and
feeding our ever growing catfish. A huge downed tree
that fell long ago is a great playground for the
little dogs. They seem to have the imagination
of small children poking into all the crevasses
and looking excitedly for bugs or lizards.

The lily pads are all along the banks of the pond and
the Water Lilies are in full bloom

A picture tour out FM 1504

Entry April 29, 2010

Even a trip out to take photos of a listing can be an adventure.
I traveled out FM1504 to take Virtual Tour Views of a beautiful
wooded retreat with a beautiful estate home on Tuesday. Not
only were the flowers at that home stunning (mostly roses),
but the fields along the way made it a pleasurable drive.

Here's a selection of the flower pictures
from our listing CC1733 on 20 Wooded AC

These were taken along FM 1504 between
Edgewood and the Interstate

Don't wait...come on out to the country and enjoy the
best state highways in the country, the most beautiful
land and the friendly people in East Texas!