REITs Real Estate Investing

REITs Real Estate Investing

REITs Real Estate Investing

In the early years of the world most cultured measured their wealth based on how much land the person owns. This land is cheerished, defended and used for the source of food. In the 20th century wealth was also built upon stock, bonds and business ownership. That allowed millions of people to invest in companies one share at a time. But Real Estate investment also joined the ranks of this securities markets. This came in the forms of REIT's which allows investors to participate in the real estate without the old problems of having to maintain the property.

After the 1960's not only wealty people and companies had the finances to invest in real estate. Note, the projects include commercial properties like malls, warehouse, business parks, etc. So the U.S. Government passed the Real estate Investment Trust (REIT's). The Law gave REIT's from corporate income tax as long as certain guys lines were met.

The requirement of the REIT is to distribut a minimum of 91% of the annual taxable income to the the share owners as dividends. In addition, the assets of the REIT must be invested in real estate and mortgage loans, U.S. Currency or Government Securities. Finally, the REIT must receive 76% of its income from Mortgage interest, rents and property sales, dividends, interest and security sales.

Excellent Tools for Retirement or Income for Living Expenses

Most of the returns from REITs is due to generally sizable cash dividends. The distribution of dividends. Dividends of this type are personal income and generally tax at generally high rates. This means that the government can take a significant chunk out of the profits. A good accountant or Financial Analyst will offset this by putting your REIT into an IRA or another retirement account. After decades of rolling these profits over and over again into IRA's the individual can amase large sums of money for retirement.

Equity REIT is described as a corporate entity that works to acquire, manage, build, renovate and sale real estate. This type of trust has a great possibility for rewards which in most cases are best suited for a professional manager. Here are some of the types of REIT's:

  • Residential REITs
  • Retail REITs
  • Office and Industrial REITs
  • Healthcare REITs
  • Self-storage REITs
  • Hotels and resort REITs
  • Residential REITs

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