REIT Investing: Everything You Need to Know About Real Estate Investment Trusts

1. Real Estate Investment Trusts (REITs) are companies that own, operate, and finance income-producing real estate properties.

2. REITs allow individual investors to invest in large-scale commercial properties, such as office buildings, shopping centers, and apartments, without having to buy, manage, or finance them on their own.

3. REITs are required by law to pay out at least 90% of their taxable income as dividends to their shareholders, making them an attractive source of steady income for investors.

4. There are two main types of REITs: Equity REITs, which own and operate income-generating properties, and Mortgage REITs, which invest in mortgage-backed securities and other real estate loans.

5. REITs offer investors the potential for capital appreciation, as the value of the underlying real estate assets may appreciate over time.

6. REITs can provide diversification benefits to investors, as they are not highly correlated with other asset classes such as stocks and bonds.

7. Like any investment, REITs carry risks, including interest rate risk, tenant default risk, and market risk. It is important for investors to carefully consider these risks before investing in REITs.

Real Estate Investment Trusts (REITs)101: A Beginner’s Guide