Tuesday, March 3, 2009

Read This Before Your Purchase REITs

What to Know Before Purchasing a REIT

If you have been thinking about purchasing a REIT (Real Estate Investment Trust), make sure you know what you are getting into before you make the purchase. A lot of people read up a bit on the various investments they are considering and then make purchases because they like the way something sounds.

With stock, bond and mutual fund purchases this may be a normal thing, but when you are doing real estate investing you should do more research, and it's easy.

Location Location Location

The first thing you should get to know when you are considering a REIT is where it is located. What is the market like in that area? This can be easily found with a little Internet research these days. Find out what complexes, properties, malls or industrial parks are included in the REIT you are considering buying and look up those areas. The more you know about the land and building value of the property you are investing in, the more you can know you are making a wise investment decision that has nowhere to go but up.


If you are investing in a new real estate development REIT this is not as much of an option, as you will not necessarily know how the project will go once construction is complete, but if you are considering purchasing shares in an established REIT, take a look at their history. Have they shown stability in the recent months or years? If they have, this is a good sign they will continue to do so.

One thing you should keep in mind on this front is that all markets, real estate included, have had a tough time over the past year or so, so if their strength only wavered during that time, you should not be too alarmed.


The bottom line here is that you want to make money. Before you get into a REIT, make sure it is one that will be making you money from the beginning and for years to come. Some REITs make more than others and the key to finding ones that will make you a better return is looking for those that are fully booked with tenants or are in a growing area that will not have a problem filling all the leases so you know the profits will start rolling in.

Doing this research may sound daunting, but it’s not if you know where to go. For example, REITBuyer.com is a website that offers all the information you need about the REIT market. You can do your research, look at past REIT investments, see comparisons of the REITs to the stock market and really get a better understanding of the investments you are considering making.

Once you have become knowledgeable and know which REITs you want to invest in, you then only have to go as far as a few mouse clicks to purchase them through REITBuyer.com, as they are a full service investing real estate broker. Then sit back and watch your work pay off.

Sound Investments for Uncertain Times

Are REITs a Good Investment?

We hear this question a lot. Part of the reason we're hearing it may be because of the tough patch the economy has had lately. Another part of the problem may be because people are just not sure of what they are and why they should buy into them. Here's a quick look at both of these topics.

What is a REIT? A REIT is a real estate investment trust. This is essentially a fund that supports real estate construction or real estate management. Basically, if you purchase shares in a REIT, that money will go into a pot that will be used to buy, build, manage and maintain real estate investments.

How do you make money? Once you have purchased a share in a REIT, at least 90 percent of the profits that are made by that REIT go right back into the hands of the investors in the form of dividends. Think of this as stock market dividends but getting a higher percentage back from profits than you ever would with other stocks, bonds and mutual funds.

Why should you buy in to a REIT? This answer is simple. Real estate is considered the strong steady market. Even when the rest of the market is crumbling, it usually keeps a pretty good foothold on things. Part of the reason for this is that real estate is an asset, and a tangible one. While values may fluctuate, property always is worth something.

For example, many real estate investment trusts have seen returns of 6-60 percent, which is as good if not better than stocks and other investing funds. So, if you know when and where to buy, there is a chance to make a lot of money.

But what about the bad economy? This is a question a lot of people are asking. They are worried that if they get into purchasing REITs now they are going to lose more money if the market tumbles again. While that could happen, the chances are that even if there were another downturn, your investment would still be pretty stable. Remember, you are still working with a tangible investment of property.

It is also interesting to know that REITs are interesting enough to get the attention of some of the major private firms such as Tishman Speyer Properties. This shows not just small investors are interested in this type of investing.

Getting into the REIT market is not that difficult. It takes little more than some time to get yourself acclimated and then learn about what it is you want to buy before you make a purchase. Start by logging onto REITBuyer.com. The site is chock full of all the information you need to learn about REITs and study the past performance of many REITs as well as get a good idea of the future possibilities. Once you are ready to buy, they are also a full service investing real estate broker that can complete that transaction in the same place.