Investors across all demographics have sacrificed their allocations to property in favour of other asset classes as a reaction to the global economic downturn, a recent study has shown.
The RaboPlus DIY Investor Survey for 2008/2009 conducted by Celsius Research revealed the average proportion of a total investment portfolio allocated to property over the past year for Generation Y, Generation X, and Baby Boomers fell significantly.
Generation Y investors’ allocation to property fell from 24 per cent to 17 per cent, predominantly in favour of cash holdings that climbed from 22 per cent to 35 per cent.
“It was the major allocation that they made last year but there has been a reasonable pull back across all growth assets within the portfolio with shares also taking a hit,” RaboPlus investments manager Tim Hewson said.
Generation X respondents reduced their allocation to property from 23 per cent to 16 per cent but show a lower level of conservatism than their younger peers with a greater allocation to both shares and cash.
“This is the most aggressive segment as they are the only segment that has increased its allocation to shares over the last 12 months,” Hewson said.
The Baby Boomers decreased their property holdings by the smallest amount, dropping their allocation from 16 per cent to 12 per cent. Their preferred asset investment area during the year was compulsory superannuation, that increased from 33 per cent to 38 per cent.
“Compulsory super and self-managed super funds were still a primary interest with a major allocation to compulsory super and a minor increase to cash,” Hewson said.
The 2008/2009 RaboPlus DIY Investor Survey consisted of an online questionnaire that attracted 503 respondents and was conducted between 6 May and 12 May this year. Each participant had $150,000 or more in personal savings.
