One of the best ways of speculating on real property is through the use of Real Estate Investment Trusts, additionally known as REITs. These investments pass through almost all their income to avoid double taxation, which is what most regular corporations are at the mercy of. The REITs have several advantages over owning real estate straight.
First, REITs are extremely liquid, to own the property directly. If you need to get your cash out, it could be sold by you and get your cash in a couple of days. Second, you can receive money through dividends. Third, dividends can be received quarterly or monthly for some REITs even, exactly like rental income checks.
Fourth, you don’t need to worry about making sure the insurance, property tax, and other expenditures are paid. Fifth, you won’t get a call at two o’clock in the morning about a seeping toilet. And finally, you don’t have to deal with evictions. Although there are hundreds of REITs to choose from, you need to be cautious about which one you choose, the debt level especially. In terms of specialties, you can pick REITs that invest in apartment, commercial, industrial, government building, medical buildings, mortgages, and many other sub-categories. Yields range between 3.2% to over 20%, but I would suggest avoiding any REITS yielding above 7% as I don’t believe those high produces are sustainable.
- Investment strategy
- To protect all your family members against your death
- Available for a place term, but coverage amount lowers each full