You can even 1% of a skyscraper, or 3% of a group of mortgages on different properties, as other people to create the other 99% or 97%. For example, if you are looking to diversify your investment portfolio by adding properties, but only has $ 3,000 $ 5,000 $ 10,000 or if you want to drag in this new field, there is usually a hell of a lot not owned you can buy these amounts. But with a REIT, because they are one of many in society do not do it alone. Because many investors real estate investment pool may invest in real estate without putting a lot of money.
If you buy a rental property, for example, interview prospective tenants to choose one, collect the rent every month, etc. as a REIT club will be responsible for other management functions such property. With the REIT can invest in properties without many problems that otherwise can sometimes be involved. But with a REIT, which are just a drop of investors.
REITs are attractive for their tax benefits. If properly structured, a REIT is not subject to federal corporate income. Properly structured, which means it meets the following conditions: there is a financial institution or insurance company, jointly owned by at least a hundred people, less than 50% of its shares are held by five or fewer individuals during the last half of the fiscal year, at least 75% of total assets in real estate investments, and at least 95% of their income from dividends, interest,.
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