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 REITBuyer.com 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.

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