As a real estate investment manager, the best way to uncover opportunities and insights to grow your investor relationships is to understand how your investors think.
To help general partners understand the modern investor, our team at AppFolio Investment Manager surveyed 104 individual real estate investors in the United States.
The 2023 Real Estate Investor Report gives you an extensive look into how investors perceive their investment management companies, how they plan to shift their portfolio strategy, and their thoughts about the current market.
Here’s a quick look at the focus areas of our report and how investment managers can capitalize on these opportunities:
Understanding Modern Real Estate Investors
Over the years, investor strategies have exhibited a pattern regarding investment capital allocation between assets. This includes stocks, 401k, venture capital opportunities, cryptocurrencies, hedge funds, and real estate properties.
While the distribution of funds between most investment types remains relatively consistent, 2023 marks the year real estate investments overtake stocks in most investors’ portfolios.
Most investors now invest 30% of their capital into real estate properties—a pronounced jump from 26% in 2021. On the other hand, investments in stocks declined from 29% in 2021 to just 27% this year.
Below are a few other takeaways revealed in the 2023 Real Estate Investor Report:
- Investors remain optimistic about the real estate market, even when explicitly asked about issues like the domestic economy, interest rates, and data privacy.
- Most investors plan to put more money into real estate assets in the following years.
- Investors are doubling down on residential properties.
For real estate investment managers, knowing how investors think allows them to improve and optimize their services.
Providing investment guidance tailored to their preferences will help you stand out from the competition, especially now that investors have higher expectations from real estate management firms.
Diving Into Investor Sentiment
The 2023 Real Estate Investor Report digs deep into modern investors’ concerns, challenges, and goals.
Factors like the political landscape, regulatory changes, and individual portfolio performance influence investors’ mindsets in different ways.
There is a unique opportunity for investment managers to solve investor challenges through the services they provide.
Tapping into investor sentiment insights allows investment managers to implement exemplary, relevant customer service and strategy planning.
With our 2023 Real Estate Investor Report, you’ll learn the key issues shaping the way modern investors navigate the real estate landscape. This includes an inside look at how investors plan to manage their existing real estate assets in the next three years.
Some of the investor sentiment insights you’ll obtain from the Investor Report include:
- How worried are real estate investors about specific issues (political landscape, interest rates, overall market outlook, etc.)?
- What modern investors consider as “major opportunities” in the real estate industry.
- How investors react to COVID in regard to real estate investments.
- The biggest challenges real estate investors face.
Inside a Real Estate Investor’s Toolbox
How knowledgeable are investors when it comes to real estate investment technology?
What are the tools and information sources real estate investors expect their investment management companies to use?
The 2023 Real Estate Investor Report will help investment managers understand real estate investors’ decision-making and asset management processes. It explores how different investor age groups incorporate software into their strategy, their sentiment towards crypto-tied assets, and their preferred platforms for real estate research and related activities.
For investment managers, familiarizing yourself with your client’s software stack and proficiency with investment tools is a must.
A growing number of investors use software in every stage of their workflows. It’s an urgent time for investment managers to educate and guide their clients to more efficient, technology-driven real estate investment processes.
Insights from our 2023 Real Estate Investor Report also highlight the top platforms and software solutions that real estate investors use. This includes:
- Investor portals
- Financial apps
- Paper filing systems
- Money management software
Investor Sentiment Toward Investment Management Firms
Finally, the 2023 Real Estate Investor Report reveals how modern investors view investment management companies. It narrows down investors’ criteria for choosing investment managers, their expectations, and reasons for entrusting their real estate investments to third parties.
A key highlight of the report is the list of features investors want from investor portals—from tax assistance to digital data delivery.
According to the survey results, more investors seek technology-driven performance analyses of their investments. The number of investors looking for a mobile investor portal increased from 55% in 2021 to 69% in 2023.
As for the reasons investors work with investment managers, the Investor Report identified the following:
- Gain advanced knowledge about the real estate market
- Leverage the financial expertise of investment managers
- Invest in assets that the company manages in-house
- Access investments that are otherwise financially out of reach
- Share liability
With these insights, investment managers can identify opportunities to improve their services. If client retention is a problem, the Investor Report will also help identify glaring issues that hinder long-term profits and sustainability.
Take Action Today
Investors maintain a positive outlook on the real estate market. Most investors also openly shared their plans to increase their real estate investments in the next three years.
Unfortunately, most investors feel their needs and expectations from investment management firms aren’t being met—not even close.
As a real estate investment manager, now’s a great time to win over investors.
Download your 2023 Real Estate Investor Report copy and get a data-driven, actionable roadmap to win (and keep) more business.