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One of the most frequent questions we get is why we recommend clients initially purchase one or two single family residential units in different geographical areas than a 10 or 20 unit apartment building located (obviously) in one spot.

This is a perfect example of what we mean by diversifying your portfolio and it is VERY important in the beginning of your income property investing career. On a recent edition of\xa0The Creating Wealth Show, Jason Hartman recounted an experience from the early days of Platinum Properties Investor Network\u2122.\xa0 South Carolina had been targeted by us as a great area for income property purchases. We don\u2019t miss the mark very much but in this case the local market didn\u2019t exactly take off as anticipated.

If you had put all your eggs in that particular basket in the form of a 10 unit apartment building, your cash flow situation might not make you happy until the market righted itself. But if you had purchased a single unit residential unit in South Carolina and another in one of our other suggested markets, you\u2019d still be in great shape. The protective portfolio diversity of having properties in separate markets would have saved your bacon.

This also goes to show the value of realizing that there is no national housing market. Real estate, perhaps even more so than politics, is local. One area of the country can be in the tank while another is hotter than fire.