With all the talk around the US$1tn valuations of Apple and Amazon, trade wars and US markets at record highs, it comes as no surprise that property and equity markets have become quite ‘noisy’. Investors would be forgiven for losing track of the simplest of messages amongst all the commentary, analysis and fancy jargon.
Yes, it might seem dull by comparison. But that’s the point. If you want stable, predictable income, dullness is a virtue.
As a reminder to our readers, here are eight reasons why we believe conservative investors looking for sustainable income over the long term should consider AREITs for their portfolios:
1. Sustainable Income
Whilst commercial property investing is primarily about income, over the last decade AREITs have done rather well in terms of capital growth.
But their most attractive feature is the strong and stable distributions generated by recurring rental income from commercial property tenants. The chart below, which plots the historical yield premium AREITs have generated compared with bond yields, makes the point.