Buy Real Estate, Sell Bonds: Charts

With real estate indexes on the rise and long-term government bonds under pressure, investors should turn to bricks and real estate, Royce Tostrams, technical analyst at Tostrams Group told CNBC on Friday.

Click here to watch the full interview with Royce Tostrams

A reversal in the steep uptrend in 30-year T-bonds as well as a lower peak suggested selling pressure was coming into the government bond market, Tostrams said.

“The real estate market is now bottoming out…From a long-term perspective there’s about 20 to 22 percent upside potential in bricks and real estate, “ Tostrams said.

He pointed to an uptrend in the MSCI world real estate index, but also in the European real estate indexes, and said he would advise investing in real estate funds.

“I would advise against buying any more long-term government bonds, both in the US and in Europe, and tell investors to take profit now,” he added.

Tostrams recommended Wereldhave and Eurocommercial Properties. He hasa 39.42 euro target price on the latter.

Disclosure

Tostrams owns Eurocommercial Properties stock.