Saturday, February 28, 2009

A Stable History - REITs - Real Estate Investment Trusts

Real Estate – Going To The Head of the Investing Pack

In the world of investing there are two kinds of people, those who make money and see a profit and those that don't. Everyone wants to be a part of the first group, but not everyone knows how to do it.

If you are truly to do well in investing, you have to take a few lessons from the big dogs. After all, they got to where they are through years of hard work and investing. They must have done something right.

The first thing you need to know is where to invest your money. Many of those money moguls will tell you their fortunes were made in real estate.

Look at Donald Trump! His whole career was made on the right real estate moves at the right time. Another thing to consider is that real estate is an asset, instead of a more fluid commodity that could disappear overnight. What if the market had a tough time? Warren Buffet once said, "Only buy something that you'd be perfectly happy to hold if the market shut down for 10 years." Can you say that about your other holdings? If you have real estate in your investment portfolio, you probably could, as real estate is something that will still have value.

For many people who are accustomed to the more traditional types of investments, they are not really sure where to start when it comes to investing in real estate. Do you have to buy a piece of property? A house? An apartment complex? The answer is no. You don’t have to do any of those things. Purchasing property outright, while still a nice investment, is a much more detailed investment than most people want to try. You want to be a part of a fund or have something as liquid as a stock, not be stuck in a situation where you are forced to deal with all the contracts and deeds of property as well as the maintenance of it.

This is why you should be looking at REITs. REITs are Real Estate Investment Trusts. Essentially these are the mutual funds of real estate. When you purchase shares in REITs you are putting money into the pot for the real estate management group or real estate development group to build or purchase real estate with and then manage it and keep it operational.

How you profit from this system is when through the money the management group makes annually. From rent in residential properties to leases of business properties, 90 percent of the profits from REIT investments must go back to the shareholders in the form of dividends each year.

Beginning investing in REITs is simple; you just need to know where to look. A website like is a great place as they not only have all of the education and research you need to find out what REITs are out there and see how they are performing, but they also are a full service investing real estate broker so you can purchase your REITs through them as well.

Investing in REITs - Stable Investments in Unstable Times

Attain Stability By Investing in Real Estate

If you have been watching the regular investment world like the stock market and mutual funds, you may think you don't want to let your money get anywhere near those fund stealers. In recent months you have seen stocks plummet. Many companies have been completely wiped off the map and all those investment funds with them.

But at the same time, you would love to have an option to make a little more money with that extra cash that you have. What can you do? This may be a time to look into real estate investing.

Historically, real estate is a pretty safe investment field. Many people see the news articles as of late about the real estate market problems. Sure, there are fluctuations, but over the long term, real estate is a wise investment. When other markets tank and fall apart, real estate tends to be the constant that holds strong as some of your other investments may be failing.

Additionally, if there were to be a complete market downturn, while your real estate investment may lose some of it's value the important thing to remember is that with real estate you have a tangible asset that will always have worth. That is much more than you can say for your stock certificates.

While you may not want to go 100% into real estate, if you are building a well-diversified portfolio, you should try to have at least 10-20% of that portfolio real estate related. This will give your investments a strong backbone that helps you in case you need to hedge against a bad day on the market.

The best way to get into real estate investing is through REITs or real estate investment trusts. These are essentially real estate development or real estate management groups that want to purchase, build and then maintain property units. These could be residential, industrial or even commercial real estate ventures.

Instead of purchasing a piece of property outright, you will purchase a share in the group that is doing the purchasing and maintaining. In return, as they make profits, you will get a portion of those profits sent to you as a dividend. As a matter of fact, REITs must return at least 90% of their profits to their shareholders. That means if the REIT does well, you are going to get a great return. Even in a moderate year you will likely get a good return.

Additionally, REITs are generally constant and stable as once people rent homes, business buildings, etc, they tend to stay there, meaning the profit will keep coming in year after year.

Getting in on the REIT game is not too difficult. Begin by going to a website like They have everything you need to add this type of investment to your portfolio. From the information you need to begin the process and research the REITs out there to being able to make the purchases for you, they can do it all as they are a real estate broker as well. Once you have made the purchase, you can even use their tools to monitor your investments and keep an eye on how that new portfolio is doing.