I’ve gotten that question occasionally over the past three months so thought I’d address it here.  The question always comes from a well-meaning individual looking for a sustainable investing opportunity of some sort.  The last few times have come during either a holiday party or some other festive occasion where I’m holding a glass of eggnog.

For the sake of philosophical discussion, let’s assume you:

1. Are genuinely interested in investing in some sort of ‘green’ investment.
2. Have about $50k languishing in your IRA/401(k).
3. Green tech (solar/wind/electric cars) seems too risky.
4. You’d be happy with a 10-15% annualized return on your money.
5. You have absolutely no time to research sustainable investing trends.
6. You do believe in a more sustainable world although you’re not moving into a yurt anytime soon.

Those conditions set, your choices could be:

1. Buy stock in a ‘green’ company.
2. Invest in a small wind power start-up.
3. Invest in a sustainable real estate project.
4. Go to Vegas and bet it all on black.

4 is riskier than 1 (but not by much) and 1 is safer than 2 but riskier than 3 which is safer than 4. Confused?  The short and simple answer is to invest in a sustainable real estate project.

A sustainable real estate project is one of the best (and safest) green investments you can make.  There are several reasons why, including:

1. Most people understand real estate. My advice (after a long career of owning/selling/brokering multi-millions of dollars of real estate) can be summed up in 7 words: Buy low, sell high, location, location, location.  Enough said.
2. Green properties appraise for more money. Here’s how and why.
3. Green properties cost less to remodel/build due to an plethora of rebates/incentives available.
4. Green properties sell faster and for more money.  They do so because people buying green homes get:
   1. Lower utility bills.
   2. Safer, less toxic (re: healthier) living environments.
   3. Increased pride of ownership since they own a high-performance ‘green’ home.

So if you have $50k (or more) languishing in an IRA or 401(k) you should consider putting those funds to work in a few green properties.  There are real estate builders/re-modelers all over the US who build/greenhab green homes.  Do a little research and you’ll probably find that there are projects going on in your area right now.  Good luck!

This entry was posted on Tuesday, January 17th, 2012 at 10:33 am