Answer: Transaction costs are elevated.

**Explanation:** - **Option A (Correct):** Private real estate markets typically involve high transaction costs due to the complexity and illiquidity of property transactions. - **Option B (Incorrect):** Private market indices are not directly investable, as they often represent theoretical benchmarks rather than tradable assets. Additionally, real estate investments usually require professional management. - **Option C (Incorrect):** Establishing a diversified portfolio of wholly owned properties is challenging for small investors due to the significant capital requirements and operational complexities involved.

Author: LeetQuiz Editorial Team