Whenever we talk about investing in real estate, the first thing that comes to your mind is buying a house. However, this is not the only way to do it. Buying and owning a house can be a hassle to most of the people. A house comes with a lot of personal and financial demands, and requires your undivided attention.
So if you don’t want to buy an entire house, but still want to invest in real estate, REITs are what you need. Real estate investment trusts are profitable for majority of the investors. One such REIT, where you can invest your money, is Stag real estate. Stag Industrial, Inc. focuses on operating and acquiring industrial properties of single tenant all throughout U.S.
Why REITs are Better Than Buying Houses?
REITs mainly own various types of commercial real estates like apartments, hotels, hospitals, condos etc. The USP of them is that they tend to pay out a large amount in forms of dividends. Real estate investment trusts are becoming more and more famous with every passing day. Here are a few reasons why it is better to invest in REITs than buying a house:
Lower Entry Cost: Investing in REITs have a much lower barrier to entry than buying a house. Even if the rates of housing are not that steep, you end up spending tens of thousands of dollars just as down payments. However, even if you have even a few hundred dollars, you can start investing in REITs, and then keep on increasing it with time.
Zero Maintenance Cost: Buying a house comes with maintenance cost. You need to repair the wears and tears, and even remodel it over time. This can leave behind a large hole in your pocket, and would require you to invest all your time and energy too. This burden is not there if you invest in REITs.
More Liquidity: For majority of people, buying a house is the biggest investment of their lifetime, and also the biggest life savings. If you ever need access to this savings, then you have to sell your house first. Thus, how fast you will have money in your hands will depend upon how fast the house sells. Moreover, if the market is going through depression, the matters get more complicated. These hassles are not there if you invest your money in REITs.
More Flexibility: Prices of housing can fall in another part of the world, opening up great opportunities to invest in. However it is always not possible to be physically present and buy a property. But that is not a concern with REITs. Thus, REITs allow you to invest in some of the most lucrative deals across the world.
Investing in real estate is always a good idea, but you need to choose exactly where you want to invest. It is crucial for you to do extensive research before taking any step as none of us would want to lose money. The reasons above clearly bring out why it is better and easier to invest in REITs than buying a whole house.