Question: REITs vs Real Estate Investing?

Question: REITs vs Real Estate Investing?

Tom Handy: Two completely different animals.REITS is like buying a stock and they can invest in different types of property. Real Estate investing has many different options – buy and rent, buy and flip, birddog, wholesale, single family, multifamily, commercial. When owning a property you also get tax benefits up to a certain limit. I believe the recent tax law put a limit in this area. But for RE investing you need to specialize in an area. You can try a different area later. There are some similiatries in real estate investing but there are also many differences. Whatever direction you decide to take, study and connect with people doing those types of investing.

Paul Lawrence: What is a birddog

Tom Handy: A person who helps an investor find a buyer for a home.

Paul Lawrence: Oh ok thanks

Rich Jordan: The concept of REIT investing is unique because unlike an ordinary C-Corp. that is not required to pay dividends, Real Estate Investment Trusts (or REITs) are obligated by law to payout at least 90% of their Taxable Income (most payout close to 100%).Furthermore, REITs help to balance the conventional common stock portfolio by reducing volatility and by providing a natural hedge against inflation.

Chris Toner: Both. Buy the physical, sell the paper. when you acquire property of substantial value, short REIT becomes your insurance. whether you trade swaps or use inverse ETFs, or any other vehicle, doesn’t matter. Property value goes higher, sell it, property value goes lower, collect offsetting profit from the short position on paper.. Same approach as precious metals

Austin Sissel: Buy a rental house and short a single family rental REIT.. not so sure about doing that..

Chris Toner: has to be proportionate. a 800sqft studio apt will create an unbalanced investment. something downtown luxury or waterfront would easily profit regardless of market direction from this strategy

Michael MorseMichael and 3,562 others joined Stock Market 2018 within the last two weeks. Give them a warm welcome to your community!: Why short a reit? Won’t you end up taking your profits from your personal proprty and then end up paying divys for your shorts? If your market doesn’t tank for 10 yrs you’ll be lucky to break even when you close your short position.

Chris Toner: if market doesn’t tank, you collect value through rental or sale. the short reit position is literally insurance on the property value itself. if youre pinching pennies and worried about divvy, you shouldn’t be in real estate anyway, but you could always use an inverse ETF long to accomplish the same goal

Chris Toner: but yes, you do bring up a solid point, you would need to figure all those numbers beforehand, build your overall trade plan before executing

Sean Mckeever: Depends on your goals

Michael MorseMichael and 3,563 others joined Stock Market 2018 within the last two weeks. Give them a warm welcome to your community!: You forgot lease. Some are reits that make their coin leasing.

Tony MorganTony and 3,563 others joined Stock Market 2018 within the last two weeks. Give them a warm welcome to your community!: Reits usually pay monthly dividends

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