Tuesday, January 8, 2013

How to Get Rich - Discover the Easiest Real Estate Investment

Do you want to take advantage of owning Real Estate in your future ?

Would you like  a simple way to get started in Real Estate investing ?

If so, there is a very simple way that you can gain the benefits of owning Real Estate quickly !

What is the Easiest Real Estate Investment ? 

As I have mentioned in previous posts, the best way to get rich is to own investments that do not take very much of your time to maintain. The problem with traditional Real Estate investing is that it can take a lot of your precious time to develop and maintain. This is especially true for individual properties that you may have to renovate and then find a good quality tenant etc. etc.

Fortunately, there is another option that the average investor can utilize without the hassles of the hands on of individual properties. It is an investment product called a Real Estate Investment Trust or REIT for short. These Real Estate Investment Trusts generally pay you a monthly income simply for holding shares in the investment. They are sold on most stock exchanges and are very simple to buy and sell. The value of their shares fluctuate in the market similar to stocks.

How it Works

A Real Estate Investment Trust takes a  pool of money from investors such as yourself and invests this money in top quality pieces of Real Estate. The Trust manages the everyday activities of each property such as collecting rent, doing maintenance, finding new tenants, etc.For providing this service, they charge a fee which is deducted from the income prior to distribution.

Each Real Estate investment Trust has a different mandate, or in other words a different set of rules which to abide by. For instance, some may invest only in office buildings while others invest solely in residential apartment buildings. Others invest only in hotels, while others invest in commercial manufacturing sites or perhaps retail malls. Whatever the trust invests in, it pretty much has to stick to that sector of the market.

What To Do

Choosing the right trust is very similar to selecting the proper stocks for your investment portfolio. You must do your research on each trust to ensure they are in good financial shape in order that they will easily be able to provide the future income you need. All trusts are not created equal and some sectors of the real estate market will do better at certain times than others. Learn all you can about a trust before making the investment. It will be time very well spent.

For the new investor and/or the investor just wanting to try out real estate investing, I would recommend selecting a good quality Trust as opposed to an individual property. In this way you will not be risking a lot of your hard earned money on a sector of the investing world that can be very costly and challenging for the unprepared.

Not to say you cannot make money on individual properties. Quite the contrary. It's just that it will take a lot more preparation and research. It will also take a lot more of your time and will come with a greater level of risk. Not generally the place to start out.

As always, I welcome your comments and suggestions for future topics.

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