The Case for Real Estate: How Real Estate Investment Fits into a Diversified Portfolio
In stating the current case for real estate, one might wonder if real estate is on trial — especially after the subprime residential mortgage crisis of 2007 led to frozen credit markets around the world. Indeed, the meltdown brought on bankruptcy filings and government intervention in an effort to jumpstart stalled economies as all asset classes faltered. The fundamental case for real estate has been and continues to be sorely tested by the financial crisis, but investors with a long-term perspective on the asset class should continue to benefit from real estate’s inherent qualities, as well as take advantage of new opportunities presented by the global economic downturn.
Once upon a time, real estate investment seemingly could do no wrong as it lived up to its reputation as a steady income producer, hedge against inflation and welcomed portfolio diversifier for investors in the asset class. In the United States, plan sponsors such as the US$199.8 billion Califo