“One of the weakest performers [is] your own personal real estate, because it doesn’t provide much income,” Robbins says. “It’s an inflation hedge. You do a little better than inflation, and you can have your own home, so there’s a psychological, emotional benefit.”
Instead, millennials in a position to buy property should be considering how to do so in a way that will provide them additional cash flow, he says.
“If you can own real estate, real estate with an income is the one [form of] real estate that’s more valuable,” says Robbins.
Opinions on the imperative of millennial home ownership vary.
Self-made millionaire Grant Cardone tells CNBC that home owners are forced to continue to spend unceasingly, and that he regrets buying a house at age 30.
“Unless you have 20 million bucks in the bank, in cash, you have no business buying a house,” says Cardone.
In personal finance classic “Rich Dad Poor Dad,” author Robert Kiyosaki notes that houses should be viewed as a liability, as opposed to an asset, and points out that it’s not a given that a home will appreciate in value.
“I am not saying don’t buy a house. What I am saying is that you should understand the difference between an asset and a liability,” Kiyosaki writes. “When I want a bigger house, I first buy assets that will generate the cash flow to pay for the house.”
Robbins emphasizes that real estate investing doesn’t need to entail keys and a welcome mat.
“You can [invest] through a REIT. You don’t have to buy everything, you get a piece of all these things,” Robbins says.
But whether millennials choose to spend their nest egg on a nest, or begin focusing on a portfolio instead, Robbins says the worst mistake is making no investment at all: “The most important thing, I think, for millennials, is to get in the game.”
See why Robbins says that to be successful, you need to avoid these three mental traps