US Millionaires Rank Real Estate as Top Investment for 2014
American millionaires are considering real estate as the top alternative-asset class to own this year, according to Morgan Stanley. About 77 percent of investors with at least $1 million in assets own real estate, according to a survey released last Thursday by the New York-based investment bank’s wealth-management unit.
The World’s riches tech billionaires have been adding more properties to their vast portfolios of real estate. Larry Ellison, America’s third richest man and the co-founder of Oracle is worth $43B. Larry has been on a real estate buying spree, purchasing over $600M in real estate over the last year, including two resort hotels and a housing development. He also owns a number of commercial assets in Malibu, California. Along with him Michael Dell, Paul Allen, Jeff Bezos, Bill Gates and Sergey Brin have been purchasing hundreds of properties recently.
Direct ownership of residential and commercial properties was the No. 1 alternative-investment pick for 2014, with a third of millionaires surveyed saying they plan to buy this year. Twenty-three percent said they expect to invest in real estate investment trusts, the second-most popular choice. As far as the chosen destinations for their investment Miami ranks among the top leading North American cities of the future according to the Foreign Direct Investment, a specialist division of the Financial Times.
Wealthy investors are turning to a rebounding real estate market as fixed-income yields remain historically low and equities surge. U.S. commercial-property values rose 8 percent in the 12 months ended Jan. 31, and have jumped 71 percent since hitting their post-recession bottom in 2009, research firm Green Street Advisors Inc. reported Thursday. The S&P/Case-Shiller index of home prices in 20 cities is up 24 percent from its 2012 low. “After a year where the Standard & Poor’s Index rose 30 percent, some millionaires are moving money out of traditional, long-only strategies to find outperformance, and turning toward alternatives such as real estate and private equity,” said Gary Kaminsky, a vice chairman at Morgan Stanley Wealth Management in New York.
Affluent foreigners have bought high-end U.S. properties for their safety and because they’re denominated in dollars, the world’s reserve currency, he said. This helps domestic millionaires maintain the value of their property investments. “Investors are spending 2, 3, 4 million dollars, plus. We’re talking serious money,” said Liza Mendez, Chairman of the Board of the Miami Association of Realtors. Some investors own dozens if not hundreds of properties in Miami. Families like the Herreras from Venezuela own more than 60 properties in Miami and they are looking to buy more. * Some Notes taken from Bloomberg.
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This really is the top investment for millionaires because of the income it can give to them. But this business is only for the rich, we can also invest in this as a part owner of it. Having some part stocks with it will also give you the chance to gain the income that you need for your family with this Real Estate Investment.
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