A Guide to Investing in REITs
You’re looking for a way to increase your investments and portfolio. If you haven’t already looked at investing in the real estate world, it’s worth taking into consideration. Real estate investment trusts are a simple way to invest in real estate. Recently out of favor with the real estate market crash, REITs are making a comeback as the market stabilizes. All REITs require is that you buy shares in the trust, rather than deal with the many, complicated steps that go along with purchasing physical property. Interested in learning more? Here’s what you should know before investing in REITs.
What To Expect:
“When you buy a share of a REIT, you are essentially buying a physical asset with a long expected life span and potential for income through rent and property appreciation. This contrasts with common stocks where investors are buying the right to participate in the profitability of the company through ownership,” Investopedia writes. According to Brass, REITs are required to pay out 90 percent of taxable profits in dividends, meaning that as long as the investments are making money, you’ll see a nice, steady return. The share prices can also gain value, similar to regular stocks. REITs also offer a bit of a safety net for investors, because they’ll always have rights to the property underlying the trust. Many REITS are also accompanied by dividend reinvestment plans.