Investing in real estate is recommended by
finance experts from all over the world for several reasons. Real estate
offers more stable pricing compared to other, more volatile channels.
It has a
high tangible asset value. Properties offer a stable and significant income
return which is highly attractive to potential investors. And real estate can
create a positive impact on your portfolio diversification initiatives.
It's no wonder, then, that even high net-worth individuals or HNWIs (which, in the UK, refers to people with a net worth
over £5 million) have a strong preference for investing in both
residential and industrial real estate.
The Cluttons International Private
Capital Survey 2013/14 recently revealed that London is the most attractive
real estate market in the world for HNWIs. According to the global property
consultant Cluttons which conducted the research, London's "safe haven
status" is the foremost financial driver for investment in the city. The
lifestyle of the city's inhabitants as well as the quality of education that
can be found there were also powerful motivators.
Elsewhere in the world, investment
properties also remain high on the list of HNWIs' asset preferences. The Hall
& Partners Open Mind survey carried out for The Australian newspaper
pointed out that 54 percent of the 202 surveyed wealthy investors (with at
least $500,000 to invest) own an investment property, while 24 percent maintain
a self-managed super fund.
Because they are putting larger amounts of
money into their investments compared to the average person, HNWIS need to hire the services of reliable financial advisors or
consultants to oversee the management and protection of their assets. HNWIs are
also vulnerable to devastating losses if their financial matters are handled
poorly, so it's best to have experts on their side.
There are family offices that are schooled
and trained in precisely the different wealth management requirements of the
wealthier population. Their services can include highly professional services
such as investment portfolio management, cash flow management, family business
monitoring, multigenerational succession planning, tax services, and
philanthropic or political donations.
Trust is a key factor in determining the
ideal consultants to hire to manage a wealthy individual or family’s assets;
the right firm will have the client’s best interests at heart and will guide
them toward the best directions to follow.
With these family offices (even
virtual ones) providing essential financial management services, HNWIs can stay
on track regarding their complex wealth management responsibilities and
continue to build their assets through real estate.
In conclusion, real estate investment holds significant appeal for high net-worth individuals (HNWIs) worldwide due to its stability, tangible asset value, income potential, and diversification benefits. London, in particular, stands out as a top choice for HNWIs, driven by its safe haven status, lifestyle offerings, and educational opportunities.
While HNWIs allocate substantial sums to their investments, they recognize the importance of expert financial guidance to safeguard and optimize their assets. This necessitates the engagement of reliable financial advisors or consultants who specialize in wealth management for affluent clients.
Family offices, equipped with expertise in various aspects of wealth management, play a crucial role in assisting HNWIs in managing their complex financial affairs. From investment portfolio management to succession planning and philanthropic endeavors, these firms offer tailored services to meet the unique needs of wealthy individuals and families.
Trust is paramount in selecting the right advisors, ensuring that they prioritize the client's best interests and provide guidance aligned with their long-term goals.
By leveraging the expertise of reputable consultants and family offices, HNWIs can navigate the intricacies of wealth management effectively, including the strategic integration of real estate investments into their portfolios for sustained growth and prosperity.
