Good returns with Asian real estate stocks and REITs
In particular, the current economic growth of the Asian states provides a sense of optimism among investors. But other factors are driving up real estate prices . For example, a strong increase in domestic consumption will ensure a stable development of the overall market. More and more people are finding their way into the cities, making urbanization an important megatrend . For this reason, especially the housing prices in the cities are rising. To cope with this increased demand, more and more cities grew and gigantic residential complexes, office complexes, hotels and shopping centers were created. A well-known example is the former fishing village of Shenzhen , which became a metropolis within a few years. As recently as 1979 , around 30,000 inhabitants lived there. By comparison, today's 15 million inhabitants are almost unrealistic. But in the coming years, the Asian real estate markets will rise sharply. First forecasts see around 50 percent of the Asian population in a metropolis - by 2023, mind you. Based on this forecast, the expansionary monetary policy will be maintained and growth will be boosted.
Returns are particularly attractive
Those who rely on Asian real estate stocks often enjoy a dividend yield of between four and six percent . If you need a constant cash flow, you can generate regular and high returns here. Pension funds and insurance companies are currently making the most of these opportunities. In the past, the annual returns of the respective securities were in the double-digit range and the high cash flows are also ensuring good expansion. Experts also expect rising dividend growth and stable market development .
More and more real estate investments are recognizable
Between 2007 and 2017 , the market capitalization of Asian REITs increased enormously. At that time, there were only 39 REITs with a market capitalization of $ 30 billion . The total market capitalization now amounts to $ 110 billion and around 88 companies have a stock exchange listing. In addition, more and more investors recognize the long-term potential of a long-term investment. At the current time, retail and office real estate can win the favor of investors.
Property stocks and REITs should be considered as part of the allocation
Markowitz's portfolio theory shows that broad diversification can increase the return on a portfolio. For this reason, investing in a REIT is generally recommended. The growth rates also make it clear that the high-quality real estate offers further growth potential. In particular, the opportunity to participate via REITs and investment funds is a good way to maximize returns . An active management approach makes better use of buying opportunities . The transparency of all decisions is also ensured by a suitable instrument. For short-term investments REITs are also a good alternative, because these securities have good liquidity and should not be missing as an asset building block. In addition, diversification provides a hedge against the total loss of money. The investment in good locations is thus possible. Meanwhile, more and more value funds are investing in this asset class to optimize the annual return.