In 2025, Australians are facing a radically different investment landscape. With inflation persisting above the RBA’s target, volatile equities, and super funds under new scrutiny, real assets—think property, infrastructure, and natural resources—are gaining new momentum. But what exactly are real assets, and why are they becoming a cornerstone of modern wealth strategies?
What Are Real Assets? Understanding the Foundation
Real assets are physical or tangible investments that have intrinsic value due to their substance and properties. Unlike stocks or bonds (financial assets), real assets include:
- Property: Residential, commercial, and industrial real estate
- Infrastructure: Roads, airports, utilities, renewable energy assets
- Natural resources: Farmland, timberland, water rights, and minerals
These assets are prized for their ability to deliver stable income and act as a hedge against inflation—a key concern for Australians in 2025 as consumer prices continue to rise above 3% year-on-year.
2025 Policy Shifts: The New Real Asset Landscape
This year, several government and regulatory changes are influencing how Australians access and value real assets:
- Superannuation Funds and Real Assets: APRA’s new guidelines encourage super funds to diversify into infrastructure and property, aiming to protect retirees from equity market swings.
- Green Incentives: The 2025 Federal Budget increased incentives for investments in renewable infrastructure, such as solar farms and wind energy, making these assets more attractive both financially and ethically.
- Taxation and Negative Gearing: Ongoing debates about negative gearing have prompted some investors to consider commercial and agricultural real estate as alternatives to traditional residential property portfolios.
For example, the NSW government’s updated land tax regime has shifted investor appetite from inner-city apartments to logistics hubs and data centres, aligning with the e-commerce boom and Australia’s push for digital infrastructure.
Why Real Assets Are Back in Favour: 2025 Trends and Opportunities
Several macroeconomic and societal trends are propelling real assets into the spotlight this year:
- Inflation Protection: Unlike cash or bonds, real assets tend to hold or increase their value during inflationary periods. For instance, commercial property leases are often indexed to inflation, ensuring rental incomes keep pace with rising costs.
- Portfolio Diversification: Real assets have a low correlation with equities and fixed income, helping to smooth out portfolio volatility. This is particularly important as global share markets remain unpredictable.
- Sustainability and ESG: Australians are increasingly conscious of sustainability, and real assets—especially renewable infrastructure and green buildings—allow investors to align financial returns with ethical values.
Take the example of QIC’s 2025 investment in regional wind farms: not only does it generate steady cash flow, but it also supports Australia’s net-zero ambitions, attracting both institutional and retail investors.
How to Access Real Assets in Australia
Australians can access real assets through several channels:
- Direct Ownership: Purchasing physical property, agricultural land, or even art and collectibles
- Managed Funds: Unlisted property trusts, infrastructure funds, and superannuation options with real asset allocations
- Listed Vehicles: Real Estate Investment Trusts (REITs), infrastructure ETFs, and ASX-listed companies focused on natural resources
For those wary of high entry costs or management complexity, fractional investment platforms have also emerged, allowing Australians to own a slice of major commercial projects or farmland for as little as $5,000.
Risks and Considerations
No asset is without risk. Real assets can be illiquid, meaning they are harder to buy or sell quickly. Regulatory changes—like shifts in zoning laws or tax incentives—can also affect values. Careful research, diversification, and alignment with long-term goals are essential for investors considering a greater allocation to real assets in 2025.
