We always hear that stocks are the best way to grow your wealth over the long run. That sentence should be changed to say that stocks are ONE of the best ways to build your wealth. Owning the best REITs could be even better.
From Jan. 1, 1972, through the end of April, the S&P 500, with dividends reinvested, would have earned 10.825% annually. $100 would have grown to about $16,000.
Not too shabby.
According to data from the National Association of Real Estate Investment Trusts, that same $100 placed into REITs that owned commercial real estate would have returned 11.73% annually. That $100 would now be worth $23,726.
That's about $7,700 less shabby than owning stocks.
We think that most investors should own at least some REITs in their long-term portfolios.
And to help you find the right REITs to add, we've put together a list of the best REITs to buy now. Here are the top two – plus, stick around below for a complete primer on real estate investing…
One of the best opportunities in real estate right now is in industrial REITs. These REITs own the warehouses and logistical centers that make commerce possible.
Plymouth Industrial REIT Inc. (NYSE: PLYM) owns 107 properties totaling 23.3 million square feet in industrial markets with access to large pools of skilled blue-collar workers in the main industrial, distribution, and logistics corridors of the United States.
They prefer secondary markets like Indianapolis/South Bend, Jacksonville, Atlanta/Savannah, Cleveland, Columbus, Cincinnati, and Memphis to the larger cities around the United States.
Plymouth is a 20% partner in a joint venture with Madison International Real Estate that plans to buy as much as $430 million in industrial properties around the country.
Plymouth will manage these properties for a 1% fee on total equity invested.
Plymouth has collected almost all of its rents throughout the pandemic and has a portfolio occupancy rate of over 95% right now.
Plymouth is on the hunt for more acquisitions with a focus on the Kansas City market. It made its first purchase there in February and likes the market's future. Kansas City is large distribution and logistical market that is perfect for Plymouth's portfolio.
Plymouth pays a dividend yield of 4.10% right now. We should continue to see substantial rent increases and a rise in property values fuel solid returns thanks to e-commerce and the rebuilding of the U.S. supply chain.
If you are going to own real estate, why not own properties where your only tenant has never missed a rent payment – and never will? Easterly Government Properties Inc. (NYSE: DEA) rents to Class A commercial properties leased to U.S. government agencies that serve essential U.S. government functions. The rental agreements are made with the U.S. General Services Administration, so there is never a problem collecting rent.
Easterly will work with the agencies to find properties that fit its needs or develop properties that fit the needs of a given situation. The buildings are then leased on long-term leases of at least 10 years, usually with rent escalator clauses.
The REIT owns 79 properties 100% leased to the government, with over eight years remaining on the average lease.
The GSA now leases more properties than it owns, and that's not likely to change. Budget constraints weigh heavily in favor of long-term leasing rather than the purchase of buildings.
Easterly Government Properties ran up last year as it was considered to be the safest yield investment on the planet during the pandemic. As we approach the reopening of the economy, the shares have drifted back down near pre-pandemic levels and are once again an attractive buy.
Easterly Government Properties currently yields 4.10%, and the continual growth of government should provide all the lift these share need to give us very attractive total returns.
REITs (pronounced "reets") are publicly traded companies that own a portfolio of real estate holdings and properties. The company pools money from its investors to buy property and generates money from the real estate. When investors buy shares in the company, they own a piece of each property the company owns.
REITs are an easy way for investors to diversify their portfolio and gain exposure to the real estate market without directly purchasing individual properties. REIT companies must adhere to strict IRS rules, which include paying a minimum of 90% of their income to investors.
As a result of adhering to strict IRS rules, REIT companies enjoy a tax-exempt status which allows them to finance real estate at lower costs and to pass those savings on to investors.
Most REITs pay dividends quarterly, but some companies choose to pay dividends to their investors monthly.
Finding the best REITs to invest in is an excellent way to earn a passive income by playing the market. The top REIT stocks are subject to change due to market fluctuations but knowing the different types of REITs available and considering market trends can help you make the right investment.
There are plenty of REIT options for the savvy investor to choose from. First, REITs can be divided into either mortgage or equity funds or a hybrid model:
Both mortgage and equity REITs can be further divided into the following categories:
Retail
A retail REIT owns and operates retail properties such as shopping centers, malls, grocery stores, and boutiques.
Office
Office REITs manage and own office buildings which are then leased to businesses and individuals.
Healthcare
Healthcare REITs involve the ownership of hospitals, medical offices, and/or senior and assisted living facilities.
Residential
A residential REIT owns and manages residential real estate such as apartment buildings, condominiums, and housing developments.
REITs are a great way to collect passive income from real estate without the hassle of actual real estate investing. Investors can expect solid returns because REITs are required to share at least 90% of their taxable income to their investors every year.
Investing in an REIT is as simple as buying any other stock. Publicly traded REITs are available on stock exchanges and can be purchased through brokers or on trading platforms. Non-traded REITs can only be purchased by brokers who have access to the trusts.
The best REITs to invest in offer considerable gains to shareholders. REITs boast long-term performance similar to other value stocks and steady dividend yields, which have remained fairly consistent during market fluctuations.
REITs often outperform the S&P 500 Index and, because of their reliability, can serve as a way for investors to hedge their bets against other stock investments in the face of market volatility.
Nearly 145 million Americans have invested in REITs due to their benefits.
As a result of the strict rules to which REITs must adhere, companies are regularly monitored by auditors and analysts—providing a level of transparency that is hard to find in other sectors.
If REIT investing sounds right for you, Money Morning is ready to help. We can help you learn the ins and outs of REIT investing and help you find the best REITs to buy now.
Marijuana stocks have been absolutely crushed in 2019.
In the last month alone, some pot stocks have lost 10% of their value or more.
As an alternative, I found a stock in the sector that makes money by renting industrial
facilities to a wide variety of companies in the cannabis industry.
Ever better, this stock takes those profits and distributes them to owners in the form of a
healthy dividend.
I'm talking about a REIT obviously, a cannabis REIT.
Today, I want to talk about one city - even in the face of economic woes - that can withstand a recession. Even at the height of the 2008 financial crisis, this town effectively had a recession-proof moat around it...
And it's all thanks to the taxes you pay.
The REIT I will discuss today focuses exclusively in this region, where home and commercial real estate are expected to climb in the years ahead - no matter who wins the 2020 election.
The best REITs tend to be the ones with stable cash flows.
But in a low interest rate environment like we have today, growing dividends become more and more important.
What we need is a REIT in a rapidly growing industry.
And that's exactly what I've found for you today...
One of the most exciting spaces to invest in right now is the gaming and casino REIT industry.
This is a relatively young area of the industry.
And I absolutely love this space because the market doesn't know how to properly value them yet.
That's where our opportunity today lies...
Gaming REITs own casinos and their proximate retail and hotel assets and lease them to gaming operators like Penn National Gaming, Boyd Gaming, and even MGM Properties.
It can take some time for the market to establish a proper trading multiple for new businesses and their assets.
This situation is playing out right in front of our eyes thanks to increasing deal making across the gaming and casino industry.
In fact, gaming REITs are experiencing a "re-rating" process, according to a recent report from Nomura Instinet.
That will make prices in the top three gaming REITs push higher in the months ahead.
Let's talk about this trend and name the three companies...
Collecting dividends from real estate investment trusts (REITs) can be a great source of extra income.
In fact, one of our best REITs to buy before 2020 has a dividend as high as 12.76%.
REITs are a great way for regular investors to gain access to the lucrative real estate market.
They also offer lucrative tax benefits.
Learn more about the tax benefits REITs can provide from Money Morning's experts!
Unfortunately, too many mom-and-pop investors are priced out of these alternatives due
to regulatory requirements, income thresholds, and stipulations around accredited
investments. But there is another way retail investors can tap into the booming real estate
market...
I'm talking about real estate investment trusts.
REITs have historically provided investors with high, steady dividends by generating
income from working real estate assets.
These alternative investments can outperform in any market, and they provide distinct tax
advantages that you rarely find anywhere else.
Today, I'm going to talk about one of the best REITs to own right now.
With interest rates at historically low levels and likely going lower, REITs are paying attractive dividends. In fact, they pay the type of dividends that used to be available in the bond market.
While a 5% dividend won’t get you all the way to easy street, it is a far cry from the 1.5% Treasury yields pay right now.
And 5% is what the best REIT available today pays investors who buy the stock now.
Real estate is the top-performing asset of the last two decades.
And it's one of the best assets to own in a period of low-interest rates.
With the Dow and S&P 500 sitting near record highs, a run on real estate is about to ensue once again.
Private equity and other Wall Street giants are building multibillion-dollar firms with one focus: to buy real estate assets that generate income and can push to new record levels.
One of the best ways to tap into the sector is through real estate investment trusts (REITs).
These publicly traded vehicles offer a stable dividend and incredible upside.
Investors looking for a high return on investment should look into the real estate sector.
Specifically, check out real estate investment trusts (REITs).
Our top REIT offers a dividend yield of more than 10%, which is significantly more than the average S&P 500 yield...
In fact, it's as much as an 8% difference.
Investing in REITs has the double benefit of stock appreciation combined with income.
In most cases that income doubles or even triples the going rate in the bond market.
Why there hasn't been a flood of cash into REITs is beyond me.
In the day after the Fed's last policy statement, the overall market dropped while REITs stood pat.
Some even appreciated in value. If you don't own REITs in your portfolio today, especially in your search for income, you should.
This week, the Money Morning Stock VQScore system unveiled another REIT to buy now.
And this one pays a solid dividend over 5%.
The recent cut in interest rates has investors looking at high-dividend stocks.
And the best of these right now are real estate investment trusts (REITs).
In fact, our top REIT today offers a 6.23% dividend.
Not only that, but some REITs offer potential price appreciation along with their high yields.
So today's best REIT an offer great returns to investors on top of a solid dividend.
REITs are known for their high dividends.
But what high-yielding REITs are worth your investment?
Our financial experts at Money Morning put together a list of our recommended high-yielding REITs!
To find the best REIT to buy now, I use something called the Money Morning Stock VQScore™.
This proprietary system tracks the most profitable REITs on the market and assigns each a score from 0 to 4.9.
That rating tells you whether shares are a "Buy," "Hold," or a "Sell."
The higher the score, the better. It also tells you which REITs could soon break out because EPS is rising, and demand for shares is picking up.
Let's unpack the top REIT (which pays an 8% dividend) to buy for November.
Curious if REITs could be a good investment for you?
We'll break down everything you need to know to make a smart investing decision.
Read more about how REITs can prove to be a sound investment from the financial experts at Money Morning.
