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Real estate investing. Is a REIT the best passive way to go?
Posted on 8/30/19 at 2:51 pm
Posted on 8/30/19 at 2:51 pm
Been looking at real estate investing and other more passive sources of income. Being a land lord seems like a hassle and bringing in a property management company seems like it’d eat away at most of your profits.
Is a REIT the best way to go? Are they really any better, income wise, than a higher dividend ETF?
Is a REIT the best way to go? Are they really any better, income wise, than a higher dividend ETF?
4
Posted on 8/30/19 at 3:18 pm to white perch
If you're looking for something truly "passive", sure.
I own ~11 units that I have property management for. It is pretty passive considering I live about 500 miles away from them. The only thing I handle outside of property management is paying taxes, insurance, and filing taxes. I get texts from time to time from property management asking if they need to send someone out to the property for some issue (leaking faucet, clogged drain, etc.), which the answer is pretty much always yes. I don't view management as "eating into profits", I view it as an expense like anything else.
I own some REITs but I don't necessarily think they're the greatest real estate investment in the world as I'm sure most of the "upside" goes to execs and a lot of the profit there is probably eaten up by general/administrative type expenses regarding running the REIT.
I own ~11 units that I have property management for. It is pretty passive considering I live about 500 miles away from them. The only thing I handle outside of property management is paying taxes, insurance, and filing taxes. I get texts from time to time from property management asking if they need to send someone out to the property for some issue (leaking faucet, clogged drain, etc.), which the answer is pretty much always yes. I don't view management as "eating into profits", I view it as an expense like anything else.
I own some REITs but I don't necessarily think they're the greatest real estate investment in the world as I'm sure most of the "upside" goes to execs and a lot of the profit there is probably eaten up by general/administrative type expenses regarding running the REIT.
Posted on 8/30/19 at 3:46 pm to white perch
quote:
bringing in a property management company seems like it’d eat away at most of your profits.
good lord man. Did you miss all the threads this has been laid out in detail? over the years here?maybe my RE thread? If i had a dollar for everytime this has been debunked here by myself or others who are RE investors here i could take us all on a trip to turks and caicos for a year! . if you buy right the PM fees should not be an issue for your cash flow. I like REIT's but they do not give me better returns than my rentals. not even close.
Posted on 8/30/19 at 3:58 pm to Fat Bastard
quote:
I like REIT's but they do not give me better returns than my rentals. not even close.
Because they are much more diversified and lower risk than owning a rental?
Posted on 8/30/19 at 4:39 pm to white perch
REITs are okay in very specific circumstances to diversify. Single family units are no bueno IMO. It’s all about MFH.
Posted on 8/31/19 at 7:45 am to white perch
My REITS:
STOR (up nearly 30% since buying it)
CIM (10.5% annual dividend)
STOR (up nearly 30% since buying it)
CIM (10.5% annual dividend)
Posted on 8/31/19 at 8:06 am to OleWarSkuleAlum
I have found certain areas where I live where some single family home neighborhoods have been a gold mine so blanketed statements like this are absolutely ridiculous. Every market is different.
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