‘Behavioural biases’ among threats to investors in 2021

In what is a period of extreme disruption, behavioural biases could become a problem for real estate decision making in 2021 warns Fidelity International’s director of research Kim Politzer.

Talking to Real Asset Media’s Richard Betts she cautioned in particular against “recency bias” – the tendency to give more recent trends greater weight, such as the level of home working. She also warned against “confirmation bias” – selectively filtering information to support our existing beliefs.

She said that when so much data is available it is important to avoid selecting data to reinforce our own beliefs and biases.

Politzer also said that owing to the amount of capital targeting real estate, pricing is unlikely to change but she warned that in the logistics investment market pricing is indiscriminate with little differentiation in yield between last mile and big box assets, or between large and small cities, despite distinctly different characteristics and prospects.

Click on the video above to watch the full interview or listen to the podcast below.