Yesterday, Ben Bernanke warned of a drawn-out slowdown for the economy. He also said the housing market “continues to be a primary source of weakness in the real economy.” Andrew Snyder says this “weakness” is really a strength.

Think about it this way: we could soon be facing a housing shortage.

Falling property prices and tighter credit markets are putting a stop on construction activity. Buildings — especially in the commercial and industrial sectors — take a long time to put up. So this industry will be the laggard when the economy recovers.

If you don’t own land, Andrew says real estate investment trusts (REITs) are a great way to play the bounce.

But you have to cherry pick.

The retail sector is a nightmare now, but health…

If you had all the money in the world, where would you invest it?

For sovereign wealth funds (SWFs), the answer is commercial real estate. These mega funds are homing in on the sector right now, according to emerging markets expert Irwin Greenstein.

We keep hearing about the real-estate meltdown. But as of the end of September, REITs have been up about 2% for the year — a far cry from the wreckage of other markets.

David Newman says we may be approaching the bottom of the real-estate slump. High levels of uncertainty remain. But when the market does turn, it will create huge opportunities for investors.

Once of the biggest casualties in the financial crisis has been REITs. Globally, these made astonishing gains during the property boom. But they’ve taken one heck of a beating since.

Eric Roseman says the US REIT sector is likely to recover first. That’s because Europe and Asia are behind the US in the credit crunch cycle and have further to fall.

Pending home sales index bounced 7.4% in September. And government-auctioned foreclosures create great property bargains. Eric says iShares Real Estate ETF (NYSE:IYR) is one good way of playing this recovery.

Remember how this whole financial mess started? Here’s a clue: house prices fell by a record 16.3% y-o-y in July.

Investors have fled the real estate market over the last year. But Andrew Snyder says the best time to invest in a sector is when it’s beaten down and oversold.

REIT Associated Estates Realty (NYSE:AEC) allows investors to bet on the housing recovery without the need to buy and sell property. It also pays healthy dividends in the meantime.

Managing the taxes on your portfolio is a crucial part of investing, says The Oxford Club’s investment director Alexander Green. Following a few simple guidelines can significantly improve the returns you make. The priority is to put the most tax-inefficient investments – such as real estate investment trusts (REITs) and bonds – in a retirement plan.

Nathan Slaughter, the chief investment strategist for The Street Authority, says putting your money only in individual stocks sets you up for “repeated sucker punches.”

This sucker-punch effect is even stronger as US stocks whipsaw mercilessly because of continued concerns over the housing and credit crises.

Diversifying into the 150 available exchange-traded funds – ETFs – paying double-digit yields can change that.

Real estate is in a black hole, says Louis Basenese. The five largest U.S homebuilders lost $3.4 billion in the latest quarter. Home-builder sentiment is at a 22-year low. Investors are salivating over the prospect of a bottom in the real estate market. But Loius says it’s best to wait. A clear-cut signal that the housing market has bottomed isn’t coming…

Americans are renting apartments and houses at the highest level since President Bush started a campaign to expand homeownership in 2002, reports The New York Times.

The percentage of homeowners, as opposed to renters, fell from 69.1% to 67.8% this year, the sharpest decline in 20 years, according to census data through the end of March.

Despite the doom and gloom surrounding real estate, Diligent Investors editor Todd Schoenberger, is bullish on one particular shopping-center REIT that’s paying a 7.5% dividend yield.