Real Estate Investment Trust- Rental Income Without Actually Buying The Property (REITs)

Most of us think buying a commercial property and having a rental income is not everyone’s cup of tea considering you need crores even to enter the real estate.

What if say you can get 5-7% rental income on commercial projects across India for as low as Rs 500. With Real Estate Investment trust (REITs), this is possible. You can consider REITs as mutual funds of Real estate, which invests in multiple real estate projects, that deliver staggering 5-7% income as dividend. Moreover, your capital will also appreciate in synchronisation with the real estate sector. So, for long term investment horizon, you can expect 10-12% yield through REITs.

Is REITs risky?
There is obviously risk involved. In case the real estate market crashes, your investment will also be affected.

How much should I invest?
It’s always a good idea to diversify your portfolio and REITs is a perfect instrument for that. You can invest 5-10% of your portfolio in REITs.

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