Direct Versus Listed Properties

After several tough years for real estate, investors are drifting back into the property market. In addition to greater stability and faith in the global economy, investors are encouraged by low term deposit rates.

For those who have weathered the storm, a potential dilemma looms in terms of direct versus listed properties. Naturally, it’s important to consider the pros and cons of a number of options. This includes real estate investment trusts (REITs), single/multi-asset syndicates, and closed/open-ended funds.

Direct Properties

Over the last year or so, property trusts have performed well, but steadily falling REIT yields have led people to opt for direct property for higher returns instead. The benefits of buying direct commercial property is less determined by the equities market. This generally means less fluctuation and more consistent financial yields.

Though direct property investment is a more drawn out process (requiring substantial capital to get started), the concrete nature of the assets provides more stability and, in turn, the returns are typically higher.

Listed Properties

One of the main attractions of a listed property, on the other hand, is its liquidity and accessibility. The flipside, obviously, is that REITs tend to be a lot more up and down.

Both direct and listed properties have their benefits depending on the financial means of individuals, though the current trend for investors steering away from unpredictability is to opt for the steadier ship of direct investments.

For more advice on loan structuring, property investment and management in Sydney and Perth, contact Rass Global Investments..

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