Real estate is one of the core pillars of our portfolio for two crucial reasons. Real estate has historically generated rates of return comparable to stocks and equities with much lower volatility and also, real estate returns are largely not correlated with stocks or bonds.
Investing in real estate also has a hidden benefit that you don’t normally think about: illiquidity. Consistent growth investing requires staying invested long-term in certain sectors without being swayed by the ups and downs of the stock or real estate markets. By putting up financial barriers that keep you from making decisions based on fear or greed, real estate investing lets us reap the benefits of the most powerful wealth-building tool ever imagined: compounded annual returns.