A real estate investment trust is a type of investment that holds a large amount of real estate in a portfolio for investors. Investors can purchase shares of the real estate investment trust and become partial owners of a portfolio of real estate. This type of investment allows investors to get involved in real estate with a very small initial investment. It is also easily traded and allows individuals who know little about real estate to get involved in the market.
A real estate investment trust is also sometimes referred to as an REIT. A real estate investment trust is managed by a professional team of real estate experts. The real estate experts take the funds that are provided by investors and use them to purchase many different real estate properties. A real estate investment trust could utilize many different types of real estate strategies, such as investing in commercial properties or multifamily housing units. Shares of this type of investment are traded on exchanges just like stocks.
One of the advantages of this type of investment is that investors can get involved in the real estate market for a fraction of the price of buying a single property. Many investors realize the potential of the real estate market but lack the funds to get involved on an individual basis. By purchasing shares of an REIT, these investors can get involved in the market even if they only have a small amount of money to invest.
This type of investment is very easy to get involved with. In order to buy or sell shares, investors will simply need a brokerage account. At that point, investors can buy or sell shares as if they were trading stocks.
Another big advantage of a real estate investment trust is that it allows individuals with little knowledge of the real estate market to profit from real estate transactions. The real estate market can be very complicated and novice investors may not have enough knowledge to be profitable. With this type of investment option, investors can put their money into the trust and allow a real estate expert to take care of all of the details for them. Most of the time, these trusts are managed by individuals who have many years of experience in the real estate industry. This allows the average investor to leverage the knowledge of real estate experts and benefit from it.