Real estate in 2010

Henry Dixon, fund manager at Matterley, looks at whether the real estate sector is displaying value.

In this country, probably above all others, we have an obsession with the underdog. From a stock market perspective this translates into a morbid fascination of trying to catch falling knives. The real estate sector has been a sharper and faster falling knife than most. From its peak in December 2007, fuelled by the excitement surrounding the advent of Reits, the sector has fallen by two thirds as overvaluation and stretched balance sheets became brutally exposed by the recession. Stock market history however would caution us against catching falling knives as sectors overvalued in the p...