Ben Willis, head of research at Whitechurch Securities, has property positions in both his Cautious and Balanced AFI portfolios.
"We've held that since the last quarter of last year," he said.
"As a house we started investing in property in September of last year. Fund managers said the market had bottomed in July last year and was reverting to type; not expecting large capital gains but with income producing and modest capital growth characteristics.
"There are still some issues with weak tenant demand, but we're confident with valuations. You're getting an average yield of 7 per cent - compared to cash and even gilt rates that is very attractive. And in volatile markets you've got a lack of correlation with equity and bond markets. There are still some potential headwinds economically; it can be an illiquid market, and there's still some way to go for the secondary market to rebound."
As a diversifier, property is a good holding, particularly for income seekers, in Willis' view: "Historically 70 per cent of the total return from property has come from income. We see it as a long-term hold."
Willis gains his exposure through the M&G Property Portfolio, although as a house Whitechurch also uses Henderson UK Property.
"The M&G fund is managed by Prupim, which has a great track record. Their size means they can go off market or they are sometimes approached by sellers. It gives them some leverage in the market – they have the opportunity to cherry pick."
Tim Cockerill, head of research at Ashcourt Rowan, gains exposure through Legal & General and SWIP's UK property funds.
"Property is back to behaving how it should, with low correlation to equities, low volatility and a yield," said Cockerill.
"From my perspective, though, there's a danger of looking at where the IPD (Investment Property Databank index) was and where it is and saying there's quite a lot of ground to be made up. I'm not convinced that's going to happen."
"There are pockets which are performing more strongly, such as London office space, but we're back to a more stable footing. It's dependent on the performance of the broad economy and that's still up for discussion with the austerity measures over the next six months. But if you want diversification and a bit of income, a bog standard bricks and mortar fund will give you that."
Financial Express data shows that over three years only one fund in the IMA Property sector has produce a positive return – the Henderson Horizon Asia Pacific Property fund.
The least risky fund in the sector is the Threadneedle UK Property fund, which lost 8.32 per cent against risk of 2.9 per cent in the three year period to 20 September. A number of funds register risk scores of more than 25 per cent while making losses of more than 50 per cent.
Source: Financial Express Analytics
However, the picture is improved for those funds with at least a 10-year performance record, when compared with a typical equity benchmark such as the FTSE All Share index. This clearly suggests that over the long term investing in property funds can produce much better returns than those seen in the period following the credit crunch, when the value of leveraged assets went down sharply.
Source: Financial Express Analytics