Study finds Reit-property return correlation

INVESTMENTS in real estate investment trusts (Reits) have often been regarded as excellent proxies to property ownership, especially in land scarce markets such as Singapore and Hong Kong.

The capital needed to invest in Reits is smaller, their units are more liquid and easily tradable on the market, and transaction costs are much lower too, compared to buying and selling actual properties.

But the questions that haven't been answered are: Just how well does listed real estate in Asia expose investors to direct real estate and how correlated are the returns from both asset classes?