Real estate takes top spot in estate planning survey

investmentnews.com:

Take note, financial advisors. Home is not only where the heart is, it’s also where the estate planning is.

According to Estateably’s “Estate of the Industry Report,” real estate was the most common asset on the Estateably platform last year, comprising 72.1% of the total value of estate plan assets. Real estate took the top spot for the third consecutive year, according to the report, with the value of real estate on Estaetably climbing from 63% in 2021, totaling $2.8 billion, to over $3.2 billion in 2023.

Estatably, which supervises $9.2 billion in assets, attributes the increase to rising real estate prices, the jump in individuals purchasing second homes and an increase in the home ownership rate in the U.S., which reached the highest figure since 2011.

The report cites a Redfin study which said a vast majority of these homes are owned by baby boomers, who own homes valued at a combined $18 trillion, compared to approximately $5 trillion for millennials as of the first quarter of 2023.

“Real estate is the highest value asset owned by most individuals, and the growth we’re seeing in volume and value reflects the important role real estate plays in creating generational wealth, Ari Brojde, CEO of Estateably, said in a statement. “Real estate owners and investors put a premium on trust and estate planning to ensure that their legacies are protected and they prevent family disputes, tax issues, and probate cases.”

Brian Hartmann, partner at Granite Bridge Wealth Management, part of Osaic, says passing along a family home to the next generation is a common goal for many Americans. The general assumption is that your beneficiaries actually want your real estate. That said, sometimes they do not, Hartmann said. 

“We