What makes a REIT attractive to investors?
Accessibility: REITs allow everyday investors to invest in income-producing real estate without large capital requirements. In fact, no minimum investment is required to invest in a REIT. Liquidity: shares of publicly traded REITs are readily convertible to currency because they are traded on public exchanges just like other stocks. Total return: REITs typically provide both competitive dividend yields, as well as the potential for long-term capital appreciation. Professional management: REIT managers are skilled, experienced real estate professionals. Portfolio diversification: real estate can help minimize risk by providing added diversification to an investment portfolio. Portfolio monitoring: a REIT’s performance is monitored on a regular basis by independent auditors, as well as the financial media. This scrutiny provides the investor a measure of protection and more than one barometer of the REIT’s financial condition.
