Avoid viewing property through rose-tinted spectacles

residential property

Investors tend to overvalue property because they do not calculate its value properly, and over exposure to this asset in particular is risky because it is illiquid and involves high levels of debt

The British have a love affair with property, in stark contrast to many other European countries. Whether this attitude originates from the Englishman and his Castle or whether there is a more deep rooted psychological origin, the emotion is certainly there. But emotion in isolation is a very bad thing when it comes to investment portfolios as it can drive bubble markets, distort asset allocation and cloud judgement. If you ask any residential property owner whether or not their main home has been a good investment, I think you would struggle to find anybody saying no. But although residen...