Tuesday, February 24, 2009

The Best Way to Invest in Reality is Through REITS

Homes for Sale Realty: How to 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 REITBuyer.com. 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.

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