Investors ask about real estate more than any other class of assets. High net worth investors have allocated up to 25% of their portfolio to it according to several recent studies. However, actual allocations are usually much lower due to real estate’s perceived risk and illiquidity.
Individual real estate investing is a very personal decision based on net worth, time horizons and long and short-term goals. If people are looking for a perfect approach about when real estate investment makes most sense and provides the greatest returns, there is not one.
One positive aspect of investing in real estate is that it can serve as a hedge against the stock market, which tends to rise and fall well below the economy. Certain properties not only keep pace with inflation but offer investors significant benefits with potential higher returns and tax advantages. Savvy investors know the truth. Adding real estate to your portfolio can be a smart move that potentially can provide strong returns and furnish you with much needed diversification.
