Sunday, May 17, 2009

Real Estate Investment Trusts and a Soft Market

If you have been considering getting into the investment arena in the real estate market, you may be wondering if you are doing the wise thing after watching the recent trends in the stock market and on Wall Street.

It's a soft market right now, we all know that. But that doesn't mean you should hide away from the investing world and wait until things are suddenly solid again. The truth is you should be doing quite the opposite. While a lot of people are losing money right now as the market softens, there are also a lot of chances to make a good profit right now if you know what you are doing and how to invest.

You see, while there are some markets that are having a tough time, there are a number of other stocks, bonds, mutual funds and investment options that are doing very well. What you need to do is know how to make the best of the soft market and where to put your money so it will grow.

Sound Investments

There are a lot of people who do not want to risk putting their money in an investment that could be gone tomorrow in a worst case scenario. That really does knock a lot of options off the table, but not all of them. There is one industry that is still going to have value, even in the worst of financial times – real estate. The reason for this is simple. While other stocks, bonds and investment options on Wall Street are based on business ideas; real estate investments are based on literal pieces of property. While those pieces of property can change in value, they will never completely lose their value. Therefore, purchasing real estate investments is a wise idea.

The next thing to think of when making sound investments is to not put all of your eggs in one basket. While you could just purchase one real estate stock, why not have a portfolio? Ok, so you may not want to have to put one together for yourself. Don’t worry. Instead you can purchase real estate investment trusts (REITs) and real estate mutual funds, which will put the portfolio together for you. Both of these types of investments are ready-build portfolios of real estate interests that you can buy into at a share price.

When you're ready to buy REITs or real estate mutual funds, you should also be careful whom you make your purchase through. Stick with a company like is the first and only online brokerage firm that specializes in real estate investment trusts and real estate mutual funds. That means this is their area and whether you need to buy, sell or just do research on what your portfolio is doing or to consider a new purchase, their website is geared specifically towards real estate investors. This will allow you to have all the information you need without the hassle of having to work to find it.

This article was written by Earl E. Bird, spokes person for the, a site dedicated to educating Real Estate Investors on how to invest in Real Estate Mutual Funds to diversify their investing portfolio. Read more articles about REITs at

Thursday, February 26, 2009

"American Conference" Talks About the History of REITs

Amercian Conference suggests understanding the releveance of the history of the REITs - Real Estate Investment Trust Market and its' significance.

Real Estate Investment Trusts (REITs) were created in the 60's so that all investors would have access to income-producing real estate through the purchase and sale of liquid securities. Before REITs were created access to investment returns of commercial real estate equity was only available to institutions and wealthy individuals.

For over half a century, REITs have become an important part of the United States economy and investment markets. United States REITs have grown from ninety billion dollars to over three hundred billion dollars in the past decade and they have gained popularity all over the world.

During their early years, mortgage Real Estate Investment Trust dominated the industry, providing debt financing for commercial or residential properties through investments in mortgages and mortgage-backed securities. Interest in equity REITs which own and manage commercial properties was limited because of the requirements that ownership and management of assets remain separate. This restriction was lifted with the passage of the Tax Reform Act of 1986 which allowed REITs to both own and manage properties. Now, more than 90% of publicly traded United States REITs are equity REITs that own and manage commercial real estate. Most of their income is derived from rents owned by companies across the nation.

There are certain guidelines and standards in place that must be followed in order for a company to qualify as a REIT in the US. The Internal Revenue Code requires at least seventy five percent of total assets be invested in real estate which realize at least seventyfive percent of its gross income from rents from real property or interest from mortgages. They must also distribute at least ninety percent of taxable income to shareholders annually in the form of dividends.

Wednesday, February 25, 2009

"American Conference" Suggests REITs

If you have been watching all the shifts in the investing markets, you may be a little worried about putting your money into any of them right now. Things have been falling and falling, how do you know where it will be safe to put your cash? American Conferencesuggests looking at REITs.

Perhaps it's time to look at some of the other investing options out there like real estate. I am not talking about running around and buying up any extra lots of property you happen to see around you. That comes with a lot of responsibilities and major outlay up front. Not only do you have to have the money to purchase the whole property, but you also have to be able to take care of it and maintain and manage it after the fact. This is a lot to ask for in an investment.

Instead, you may want to look into another type of real estate investing, real estate investment trusts. Real estate investment trusts or REITs are funds where you purchase shares of the investment and a real estate management group of real estate development group uses that money to purchase, build or maintain property ventures. You essentially fund a portion of a property acquisition and management group.

In return for your investment, you will be paid a portion of any profit that the company makes, much like a stock dividend.

While you may be wondering how wise it is to consider real estate in today's tough market, this is exactly why it may be a good time to look at a little more investing. Here's why. Sure, there has been a tough time for the markets. Lending has dropped, defaults on properties are on the rise. We're in tough credit times.

But now let's look at the positive side of things. Most think the slide has slowed and will soon be stopping. Add this to the fact that those capital markets that REITs use to get their funding for expansion and other purchases are low and that means the chances for REITs to get the capital they want to expand has dropped, for now. While you may think this is a bad sign, the truth is this is a time when the value of REITs is lower, meaning you can get in at a lower price. As things settle and go back to normal, your profits will go up and you will see an even greater return on your investment.

This is the time to log onto a website like and find out what REITs are out there, what they are selling for and get yourself in on this low tide so you can enjoy the ride when the financial wave picks up again.

With the other option being putting all of your money away and seeing no growth, what would you prefer?

Money Making Guru Robert G. Allen may have said it best saying, "How many millionaires do you know who have become wealthy by investing in savings accounts? I rest my case."