REITs — Group Real Estate Investing

by creitadmin on May 20, 2009

Real estate investment trusts (REITs), as a form of group real estate investing, are a great way to capitalize on expensive properties. It is well-known that substantial profits can be achieved via larger investments. Investors with significant equity, such as builders or developers, can build and sell projects for a lucrative profit. Next, they re-invest these earnings into increasingly larger projects, continually building upon the previous wealth accumulated. Having said that, it is very difficult for an individual investor to duplicate this. REITs band together a group of like-minded investors. Pre-existing mechasnisms and legal frameworks facilitate this process. Pooled capital is then used to purchase substantial investment properties. Limited expertise in real estate also tends to be a recurring theme. REITs eliminate both of these investor barriers to entry, creating an attractive investment alternative.

 

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