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Bank Of America Investment So you want to be a landlord without having the problem of repairing faulty roofs and lights? Maybe real estate investment trusts (REIT) are for you. These structures are basically legal structures to allow investors to get access to the rental proceeds via dividends. These rental proceeds are net of property management fees and other legal fees pursuant to the transaction.

Real estate can be a wise investment but beyond purchasing a home of your own, what is the best way to invest in real estate without getting your hands dirty and spending your spare time chasing tenants for rent A REIT or Real Estate Investment Trust may be the perfect investment vehicle. REITs own, and often operate, real estate but are publicly traded like stock. Profit is paid as dividend to stock owners.

Investment Opportunity Developers use this instrument to offload properties in their stable into the real estate investment trusts so as to generate cash to purchase other commercial buildings while retaining a sizeable stake in the REIT. Each year or half yearly depending on the REIT, they distribute rental income in the form of dividends to investors. Things to take note off include what the properties in the REIT are. Sometimes developers try to move their non-performing assets into the REIT so that their listed companies can report better illusory earnings and you should take note of this.

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Banc Of America Investment Now that we have explained what a REIT is, the rest of the article will highlight three reasons why you might want to invest in a REIT.

So, how does an investor accomplish this feat Simple. Become an asset to the developer when they NEED you! Last week, we introduced the concept of working in a real estate investment club (or group) and the power of Get 'er done. Quite simply, if a developer or broker knows that your real estate investment club can HELP them, then they frequently will think of you first. To understand the importance of a real estate investment club, relative to an individual investor, let's consider 3 scenarios for a developer.

Banking Investment Firstly, owning units in a REIT allows us to gain rental exposure to large commercial buildings. Let's face it most of us real estate investors do no have the financial ability to own large commercial buildings so sometimes it will be good to purchase units of a real estate investment trust so that we can participate in the upswing in office rental of a commercial building.

• Northern Trust added a Japanese real estate investment trust fund to its NETS family of ETFs. NETS Tokyo Stock Exchange REIT Index (JRE) started trading Sept. 8. The country's REIT market makes up 10% of all global real estate investment opportunities, according to Northern Trust.

Investment Solution Strategic Secondly, owning units in a REIT because of its trust like structure allows for a tax flow through of the profits (this means no tax on profits from the REIT). If in doubt, spend some time consulting your tax attorney for advice on this. Another way to get some tax knowledge is to ask for a copy of the prospectus of the REIT and read the section on tax advice.

Do you need a real estate investment calculator to figure out how much you£l make on your property Do you need a return on investment calculator to figure out how much you®e investments will bring back to you We have a real estate investment calculator and a return on investment calculator to help you you®e your finances. What about an investment interest calculator to determine how much interest you£l make on your savings account or investment We have that too. In fact, we have various kinds of investment calculators to help you with the calculations you need.

Investment Banking Services Thirdly, listed REITs are tradable like shares so you can do the normal things that you would do with shares. The advantage of this is that you can examine the usual commercial rental data to determine whether rentals are going up or not and when you should purchase the units in the REIT. Always remember the importance of value investing especially so in an investment involving real estate. Spend time researching on the REIT that you are interested and figure out the value that you think it is worth and wait for the unit price to drop and swop in to make your purchase.

Bank Investment In conclusion, we have gone through the basic concepts of how real estate investment trusts work and highlighted three reasons why you might want to invest in a real estate investment trust (REIT). Remember that like with all investments, do your due diligence, time your entry and exit properly and you can make money both from the equity value and the rental yield of the underlying properties.

Catalogue: Finance | Real Estate
Title: Understanding Real Estate Investment Trusts By: Joel Teo

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