Real estate as part of your wealth planning

Anyone building wealth will, sooner or later, think about diversification. Not everything in one place, not everything in one form. In that consideration, real estate has traditionally held a unique position. What role can it play alongside stocks, bonds, and savings? And what should you look out for?

Tangible assets

Real estate is a tangible asset. You can see, enter, and assess a villa. For many investors, that feels different from a position on the stock market. This tangibility doesn't provide a guarantee, but it does offer insight. You know what you are investing in and can follow the progress of a project.

Diversification

The value of real estate does not always move in tandem with financial markets. As a result, it can be a valuable addition to a portfolio that otherwise consists mainly of stocks and bonds. Diversification does not eliminate every risk, but it prevents everything from being dependent on the same development at the same time.

Horizon and liquidity

Real estate projects require patience. At Dutch Value, a project typically runs for 6 to 18 months. For fixed interest, the term is 12 to 36 months. During that period, your capital is tied to the project and cannot be withdrawn early.

This means that real estate is primarily suitable for capital that you do not need during the term. Therefore, always keep sufficient liquid assets available for unforeseen expenses and opportunities.

Balancing return and security

Within real estate, you can choose how you weigh return and security. With profit sharing, you participate in the appreciation of a project. With fixed interest, you receive a predetermined return. The hybrid model combines both. This way, your investment aligns with the role you want it to play in your wealth.

What is a sensible amount?

There is no fixed percentage that is right for everyone. It depends on your total wealth, your age, your income, and your goals. A rule of thumb is to never put more into a single investment than you can afford to lose without jeopardizing your plans. An independent financial advisor can help you determine that ratio.

Thinking in generations

For many of our investors, wealth planning goes beyond their own lifetime. They think about children and grandchildren, and about wealth that is managed well and passed on. This requires investments that you understand, that are carefully documented, and that fit a calm, long-term perspective.

Would you like to explore what role real estate could play in your situation? In a personal meeting, we can lay out the possibilities for you.

This article is general in nature and does not constitute financial advice. Investing involves risks.