Where Should You Put Your Royalty Money?

Where is the best place to put oil royalty money? That is a great problem to have and there are lots of options and a lot of people trying to help you spend it. I am a proponent of diversity. Don’t put all your eggs in one basket. One basket that you always want to look at and to be a part of any investment strategy is Real Estate.

According to a Professor G. William Domhoff, UC Santa Cruz in his publication, Wealth, Income, and Power 2005 revised in 2012, in the Wealth Distribution by Asset Type in 2007, 77% of the non-home real estate is owned by 10% of the people. People with money invest heavily in real estate.

The US economy since 2007 has taken a real pounding. Any time this happens, opportunities come with it. In the case of real estate, values have adjusted dramatically downward in most parts of the country. In Williston and the Bakken region, values have gone up. It is said that with real estate, you make your money on the “buy.” In other words, buying at a good price going in gives you your best chance of making a good investment. Your best chance of making a good “buy” is not where values are going up, but where values have adjusted down.

Look 283 miles south west to Billings, Montana, referred to as “Montana’s Trailhead” and as the “Magic City.” At 104,000 people, it is the largest city in Montana. Billings has a diverse economic base including agriculture, energy, transportation, tourism and recreation. It is a major hub for retail and wholesale outlets, education and medical facilities for Montana, the Northern Rockies and the Northern Great Plains. The city’s primary trade and service area is one of the largest in the U.S., 125 miles serving 250,000 people with a secondary trade area serving over 385,000 people.

Billings has not suffered nearly as much as the rest of Montana or the country from the recession. Real estate values have adjusted to the market which means there are good deals to choose from. It is said that once a city hits 100,000 population, 200,000 comes quickly which means Billings is in the “Path of Progress.” Getting an 8% or 9% rate of return on a quality income producing piece of real estate in Billings is happening right now. Buying raw land in areas where the city will grow is well priced and available. Billings, Montana is a great place to invest your money, be able to come see it working and enjoy the hospitality and the wonders of the city and the area.

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