As recently as 2006 it was commonly heard that real estate was the safest investment you could make. But even in 2006, there were some people, known as "insiders" who were actively investing in movies. They knew about the profits others were making with real estate, yet they kept investing in movies. Logic says there had to be some reason for them to keep doing this. This article will explain why some intelligent and knowledgeable people are enamored with investing in movies.
It is as easy to make a movie and market it, as it is to make an apartment building and market it. It just involves two different types of know how. To build a rental unit, different experts are hired for the various aspects of the building, such as carpenters, electricians, plumbers, and so on. An investor does not need to know how to do any of the actual jobs, the investor just needs to know how to coordinate everyone, as well as get the building permit, and apply for zoning cha nges if needed and so on. The investor can hire a contractor who then hires the various tradespeople, instead of doing it themselves. To make a movie, an investor can hire a contractor, known as a producer, to hire the cast and crew and coordinate everything.
The rental life of an apartment can usually be expected to be about 50 to 60 years. It can be more, and it can be less, with factors such as rot and termites to be considered. During this time, a lot of effort is involved in the management of the property, by way of maintenance and insurance for example.
Movies can have a revenue life of 60 years or more as well. And once made, there is no maintenance. Humphrey Bogart is still making money for someone! You can verify this by checking your TV movie listings, and you will see that many movies made 20 to 30 years ago, are still very popular, and they are shown repeatedly on TV.
For the same investment, a movie can make up to a thousand times as much as a rental property. This is especially true for low budget movies. With a digital camera, a home computer, and unknown actors, a quality movie can now be made for only $200,000 to $300,000. There have been movies made for under $30,000 which have made 100 million dollars. It takes research to find a promising movie project to invest in, the same way it takes research to find the land in the right area on which to build a successful rental unit. There are movie investor "insiders" who are happy to perpetuate the myth that movies are very risky, because they want to keep others away from what they know is a very lucrative industry to invest in. And compared to apartments, movies are a lot more fun!
