Just one question (not sure if anyone come across such question). It says that we should exclude the resident house bec of illiquidity. So it the house is not a resident house but purchase as part of an alternative investment to include in client’s porfolio (can be income generating i.e. rental income or may be not). So when we compute the return requirement, should we include the valuation of the non-resident house?
House in general are illiquid…not sure you want to include that as your investable asset base. Unless it states specifically that you hope to extract rent on your secondary real estate.
ok thanks