Investing in Property Funds provides investors with the opportunity to invest in property non-directly, removing some of the associated risks of direct property ownership. Fund investment offers investors the opportunity to pool together their capital with others, under the management of an experienced professional. This generally affords access to better and more lucrative opportunities.
For example, in times like these, and by that I mean times of global financial distress, there are opportunities, as real estate owners struggle to re-finance debt, some are forced to sell their assets well below market value to inject liquidity and stay afloat. Whilst this is indeed great news for investors holding cash, at the same time, these opportunities tend to occur in the higher echelons of the value scale, preventing anyone with less than £1,000,000 from getting involved in the real bargains.
The answer is investing in Funds, effectively putting your chips on the table along with others, and giving them to someone with the contacts, expertise and experience to transact on the best deals very quickly.
There are Property Funds available for just about everything; there are Vulture or Opportunity Funds, that use their huge and instant liquidity to buy up distressed housing or commercial stock. There are specific market Funds that concentrate on acquiring property in certain areas, there are commercial property funds, residential property funds, industrial, office space, hotel and every other imaginable form of real estate fund.
Most Funds have specific rules about the type of transaction they will get involved in, for example some may have a limit on single item expenditure, some invest for income through renting out their assets, and others simply buy to re-sell. Property Funds can either be regulated or un-regulated and my advice would be to stick with regulated funds as you then have the option of appealing losses to the relevant regulating authority if your money is mismanaged.
Investment returns from Property Funds vary wildly, for example I have worked with Property Funds that have broken even, and I have worked with Property Funds that have provided consistent long-term returns around the 14% per annum mark. At present I am working with a Property fund that has a targeted return of 7% per annum which, in today's market, is an excellent opportunity.
The benefit of ifund investing is that you achieve exposure to the most stable long-term asset class - Real Estate - and at the same time avoid the cost and hassle of direct property ownership and you remain more liquid than direct property investment as you can usually sell on your share in the fund at short notice for full value, whereas a property takes time to re-sell.
In all, provided you are comfortable with the advice being given, investing in Property Funds offers diversity, real estate exposure, and managed risk, and I for one, am a fan.
If you would like advice on Property Investments or other real estate related investment solutions such as structured fixed return property syndicates and agri-land investments, please contact me with your requirements or questions at davidgarnerconsulting@gmail.com
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About the Author:
David Garner in Managing Partner at David Garner Consulting and Senior Portfolio Manager with BRIC Group. He has been successfully advising private clients and syndicates on various real estate investment strategies for 8 years
Article Source: http://EzineArticles.com/?expert=David_D_Garner
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