What Real Estate can Learn from the Stock Market in 2018

In what has otherwise been a bloodbath of a market as 2018 ends, one set of stocks has taken much less of a hit.  These are the high dividend yielding stocks, companies like Verizon, IBM, Exxon, Pfizer, etc. that have also gone up in value.  Investors that have taken their money out of growth tech stocks have been able to cushion the impact of the current historic market free fall.  Real Estate is an asset class with a negative correlation to the market and so offers a natural diversification for investors.  Pretty much the same principles can be followed while investing in Single Family Real Estate (SFR).  There are properties that can be bought speculatively for growth and properties that offer good yields with more limited growth prospects.  The former is very similar to growth stocks in that they are more expensive - think higher priced neighborhoods in San Francisco, Los Angeles, or in Seattle and New York, or other coastal cities.  The latter parallels dividend stocks as income properties that can be found in many parts of the Midwest and the South - think Indianapolis, Atlanta, Dallas or Orlando.  Interestingly, these areas are less subject to the speculative swings that we see in the more expensive coastal areas.  Investors can come out ahead by using the same stock market playbook that has mitigated losses.  They can invest in areas that provide good yields - think dividends - while still providing a decent modicum of growth.  The challenge that many investors face is that the properties may not be located close to where they live.  A substantial number of investors typically live in high rent districts offering only ‘growth’ real estate.  These investors are often not aware that while the growth may be slowing in their neighborhoods, properties in other areas may still be appreciating.  They would benefit from a convenient way to research these areas, weigh risk vs returns and to connect with local delivery partners that can help acquire and manage the properties.  Unlike the stock market, real estate did not till now have a data driven platform that synthesizes all this information in one place.  Investimate(investimateroi.com) from Homeunion(homeunion.com) is such a platform and available to investors on its homepage or via the stakeholders that serve this market - property managers, realtors and the financial service providers.  Ultimately, it is designed to help SFR investors diversify from the vagaries of a volatile market and follow a ‘yield plus growth’ strategy to preserve and grow their capital.