Learn About Real Estate Through Investing in REITs and Publicly Traded Real Estate Companies

Learn About Real Estate Through Investing in REITs and Publicly Traded Real Estate Companies

What is a REIT?

A REIT (pronounced REET), or Real Estate Investment Trust, is a company that owns, operates or finances income-producing real estate. Modeled after mutual funds, REITs historically have provided investors of all types regular income streams,  diversification  and long-term capital appreciation.

Est. 1960
REITs were established by Congress in 1960 and are modeled after mutual funds.
$55B
Stock exchange-listed REITs paid out approximately $55.7 billion in dividends during 2016.
$1T
REITS trading on stock exchanges in the US have an equity market capitalization of more than $1 trillion.

Why should you invest in REITs?

Diversification
REITs have historically provided:
  • Low correlation with other stocks and bonds
  • Higher risk-adjusted returns
  • An investment in real, tangible assets
Liquidity
REITs have historically provided:
  • Ability to buy/sell like other stocks, mutual funds and ETFs
  • Opportunities for tactical asset allocation
  • Easy portfolio rebalancing
Transparency
REITs have historically provided:
  • Corporate governance aligned with shareholders interests
  • Audited financial reports
Dividends
REITs have historically provided:
  • Dividends & wealth accumulation
  • Regular income from rents
  • Reduced portfolio volatility
Performance
REITs have historically provided:
  • Total returns above the S&P 500 over the past 25 years
  • Higher returns than corporate bonds
Past performance does not guarentee future results. Information should not be construed as investment advice and is for informational purposes only.

What are the different types of REITs?

There are two primary types of REITs: Equity REITs and Mortgage REITs. The two types give investors the opportunity to invest in either the equity financing or the debt financing of real estate.

1. Equity REITs
Equity REITs earn income by collecting rent or through the sale of the properties they own.
Equity REITs
  • Invest in real estate across a wide range of property types
  • Equity REITs own more than 200,000 properties in the U.S.
  • 157 companies in the FTSE NAREIT Equity REIT Index
  • Total market capitalization of nearly $1 trillion
Source: SEC Edgar/SNL
2. Mortgage REITs
Mortgage REITs provide financing for real estate by purchasing or originating mortgages and mortgage-backed securities (MBS) and earning income from the interest on these investments.
Mortgage REITs
  • Invest in both residential and commercial mortgages
  • MREITs help finance 2.5 million homes in the U.S.
  • 36 MREITs in the FTSE NAREIT Mortgage REIT Index
  • Total market capitalization close to $60 billion
Market Capitalization of Equity and Mortgage REITs in 2016

Equity REIT Sectors

Select below

Notable REIT-Owned Properties

The information on this Site is for informational purposes only and the Site is not intended to be a solicitation related to any particular company, nor does NAREIT intend to provide investment, financial, legal or tax advice. More...