If you have noticed, big funds managers and investment Gurus have started highlighting investment into real estate and property sector during increasing interest rate environment. Why ? because this sector has done relatively well during rising rates.in past decades. However within property sector you can pick up specific groups to get better returns. Check out below chart and let’s discuss which group have done best within property sector.
🪓 𝙏𝙞𝙢𝙗𝙚𝙧 𝙖𝙣𝙙 𝙎𝙚𝙡𝙛 𝙎𝙩𝙤𝙧𝙖𝙜𝙚: if you follow news these two sectors have delivered strong returns , as much as 42% for timber and 62% for self storage! they have also been relatively risky, with some of the widest variations in returns. so my advice for safe players stay away !
🏭 𝙄𝙣𝙙𝙪𝙨𝙩𝙧𝙞𝙖𝙡𝙨 : if you like medium risk , Industrials property sector is for you , it has seen the highest median return. ( last 10 years around 20% ) and with some of the Biden’s build back better plan this could be beneficial.
🏠 𝙈𝙤𝙧𝙩𝙜𝙖𝙜𝙚 𝙨𝙚𝙘𝙩𝙤𝙧: The second highest median return goes to this sector. which earns income from the interest on mortgages and mortgage-backed securities. The mortgage sector has seen less risk than most other real estate categories, at least in the last decade. giving median return of 16.3%
🌉 𝙄𝙣𝙛𝙧𝙖𝙨𝙩𝙧𝙪𝙘𝙩𝙪𝙧𝙚: If you like to play safe , this sector is for you . These properties had a positive return on investment for all of the last 10 years, and had the lowest risk of any property sector. Giving median return of 14.3%
Now if you are kind of investor who doesn’t like to take history data and make investment decision may be healthcare and retirement home property sector could be for you as aging population will drive government across world provide support and benefits to these sector , driving increase in spending.