Tangible assets this year are receiving more emphasis as an alternative investing option for investors of high net worth. These tangible assets include commercial and residential real estate properties in California and other states. A recent survey showed that about 60 percent of high-net-worth individuals felt optimistic about investment in land and timber and in real estate compared with other investment options, such as private equity, hedge funds, bonds and stocks.
Some experts in the industry fear that the real estate market has already plateaued. However, other players in the industry say they are still seeing people who are strongly interested in real estate investments. They are looking specifically for income yield and capital appreciation from rentals.
The risks related to real estate admittedly can be high. This is particularly true considering what took place in 2008, during the real estate and financial crises. This is because real estate investments are not liquid by nature. However, current market conditions indicate that now may be a wise time to buy up real estate, with commercial rents -- especially those in a central business district -- particularly providing a huge investor opportunity.
Commercial and residential real estate investing has the potential to provide regular income, which is one reason why it continues to be popular in California and other states. However, not understanding the ins and outs of a real estate deal can quickly cause a potentially promising deal to die. An applied understanding of the law may help investors to navigate real estate transactions and achieve their financial goals as a result.
Source: onwallstreet.com, "Real deals: Why more advisers are turning to real estate now", Nicholas Yeap and Ralph R. Ortega, July 5, 2016