How to Begin Investing with REITs

reit-graphicREITs are a great way to invest – even for the beginner.

The world of real estate has been around for ages now. Now that that’s been said, it isn’t surprising that Wall Street has found its way to turn real estate into a publicly traded instrument. A real estate investment, or REIT, is created when a corporation uses the money of an investor, or investors, to purchase and maintain income properties. REITs are typically purchased and sold on the major exchange platform – just like other stocks. A corporation must also pay a majority of its profits (taxable) in the form of dividends to sustain its status as an REIT. Furthermore, REITs also avoid paying corporate income tax, opposite of a regular company where their profits will be taxed and then will have to decide, after taxes, if it will distribute its profits as dividends.

How You Can Make a Profit With REITs

This is where you as an investor comes in. When you buy in to an REIT, you will receive a share of the dividends that the company pays out periodically. Much like regular dividend-paying stocks, REITs are a solid option for investors that can pay a good amount. REITs also allow investors to buy into office buildings and other similar types of properties that are highly liquid. By buying into REITs, you won’t need a realtor to help you cash out the investment that you’ve made. This style of investing has found a home in the hearts of thousands of investors – and this number will only continue to grow.

Kuba Jewgieniew is the head of Realty ONE Group, a real estate brokerage firm that has been ranked as one of the fastest growing companies by INC. 5000.