The U.S. real estate market has largely recovered -- but for advisors whose clients want to invest some of their assets in property, that rebound creates both opportunities and challenges.
As noted in Financial Planning's
cover story on real estate's new rules, more expensive properties eat up more cash and can mean servicing a bigger loan. They occupy a bigger proportion of a less-diversified portfolio; and if prices increase faster than rents, the properties will return less cash, making the owner -- that is, your client -- more vulnerable to the financial hits of vacancy, maintenance costs and careless or destructive tenants.
Want to understand these clients a little better? A recent survey from the National Association of Realtors took a deep look at investment real estate buyers and identified several characteristics that set them apart. Page through to see the details, or see this as a one-page version here
. -- Rachel F. Elson