Investing in real estate is recommended by
finance experts from all over the world for a number of 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
in excess of £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, it is highly
important for HNWIs 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.
Do you have have any questions or suggestions? Write in comment section.
