Wealth Creation & Preservation
Real estate provides investors with an effective and risk-adjusted way to build, manage and preserve wealth, and save for significant life events such as retirement and children’s education. Specifically, real estate investments can build wealth through equity build-up, asset appreciation, and cash flow distributions. This three-pronged approach effectively increases investors’ after-tax returns when compared to traditional stocks and bonds.
Unlike most annuities, bonds, and fixed income products, real estate offers protection against inflation. Historically, real estate investments have outpaced inflation and, as such, helped investors maintain purchasing power during their retirement years.
Low correlation to public securities markets
Real estate investments are backed by tangible, hard assets thereby limiting their downside risk. Real estate investments are independent of many of the factors that cause volatility in the public securities markets. This is a key advantage for stability in a well-diversified portfolio. Adding real estate to a portfolio helps investors increase their diversification and allows them to participate in a market cycle that can complement the stock and bond market.