It’s been a crazy year so far, and there is plenty left to come. Despite all of it, the U.S. economy has grown steadily, and now is the best time in roughly a decade to consider expanding your investment portfolio.
One of the best ways to turn over a good profit is to look for the right niche markets. Initial costs are often a little more manageable, and in the right areas, risk is as minimal as possible. These five markets are doing well and poised to do even better.
Mobile Homes
For anyone with a sharp eye for real estate, this market was a clear choice as many as five years ago. When the housing market collapsed, buyers trended away from fancy, large homes and back towards smaller, cost efficient options. This equates to apartments and mobile homes, but it is the latter that has seen truly explosive investment opportunities.
The biggest name in the business is Zell’s Equity LifeStyle Properties, and they are currently worth around $5 billion. If you don’t want to aim for the highest buy-ins, many smaller property owners are still trading and ready for capital that will let them open new parks. Even as housing is slowly recovering, the mobile home market isn’t going anywhere.
PowerShares ETF
The S&P 500 has surged in the last few years, and this year it is set to outperform even the best managed funds. The opportunity for making big money is here, but many experts wonder how sustainable the growth really is. Enter the PowerShares.
These are still benefiting from the S&P 500 rise, but they focus on keeping the volatility out of your investments. These companies see a bit slower growth than the rest of the S&P, but if things do slow down or enter a bear market, the PowerShares will likely continue to make you money. This is a niche that may sacrifice a few short-term gains for the promise of better security in the long run.
Student Housing
Regardless of how you feel about “free” college tuition, it’s a big topic in the election cycle this year, and no matter who wins, federal spending on tuition is very likely to increase. Tuition itself is a dangerous game, as subsidies have already caused rampant inflation, and regulation or some form of collapse may be around the corner.
The one thing you can absolutely expect, however, is the continued trend of increased enrollment. No matter how the federal government decided to make college more accessible, you can bet the students will need a place to live.
You can look for exponential increases in this market, and they’re strong to begin with. In 2015 alone, the market saw an 81 percent increase in revenue, and investors had an average cap rate of 5.92 percent.
This is a niche market that stands to give you monstrous dividends, and the risk assessment is remarkably low. One tip: do a little investigating in the real estate properties before you commit. Not all student housing is created equal.
Cloud Data Centers
Like student housing, this is another niche real estate market that shows no sign of slowing down. All technology is becoming increasingly cloud based. Even this letter was originally drafted using cloud software, and there is no sign of any technological shift away from the cloud on the horizon.
Researchers aren’t even looking for another option; they all perceive cloud services as the ideal future for technology. That’s why the industry was worth $115 billion in 2015, including a 6.1 percent annual increase. Investment in cloud storage sites is about as reliably large in profit as any you can find.
Like with any niche real estate, you have to do a little research for the best results. The most valuable data centers will be located in population centers with access to cheap and abundant electricity. Proximity to other major data hubs is a bonus.
For Profit Healthcare
Healthcare in general offers dozens of niche markets, all of which are highly profitable. For profit care is in a unique position to experience the best growth, as federal regulation has dramatically increased the number of insured individuals, made more for-profit options coverable and increased Medicaid spending and availability.
Again, the current election cycle indicates nothing to suggest that these numbers will go down. Both major candidates are in favor of expanding current insurance laws to bring the numbers even higher.
Private spending in healthcare exceeded $563 billion last year, and the numbers are going to keep climbing. The niche investment potential in healthcare easily eclipses all other industries, almost worth more than their combined totals.
Regards,
Ethan Warrick
Editor
Wealth Authority
