The Dangers of REIT Investing: 3 MUST KNOWS Before Investing in Real Estate Investment Trusts!

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In this video, I discuss the dangers of REIT investing and the 3 things you need to know about REITs before you invest! REITs, otherwise known as Real Estate Investment Trusts, can be a great alternative investment to buying real estate. You don't need a down payment, you don't have to deal with tenants, and you can earn passive income through investing in REITs. Furthermore, REITs are excellent dividend paying stocks and actually have very high dividend yields! However, there are several concerns I have with buying REIT stocks that investors MUST understand before investing into REITs, which I'll be discussing in this video.

Anyways, thank you for watching! If you did enjoy, please hit the LIKE button to support my channel – I would really appreciate it. Also, be sure to SUBSCRIBE for more weekly content on personal finance, business, and investing!

Please note that I am not a financial advisor. I create these videos for educational and entertainment purposes only. Before investing, make sure you perform your own research and understand all of the risks involved!

Cheers,
Investing Engineered
Nick Peitsch, E.I.T.

[NickPeitsch]

Do you own any REITs in your portfolio? Let me know!

[RobertMichaelmr]

Every crash/collapse brings with it an equivalent market chance if you are early informed and equipped, I've seen folks amass up to $1m amid economy crisis, and even pull it off easily in favorable conditions. Unequivocally, the collapse is getting somebody somewhere rich.

[MakeamericaGreatagain-hj]

Housing crisis, health crisis, cost of living crisis, debt crisis, inflation crisis, middle East crisis. How many crises can a koala bear? I'm approaching retirement with comfortable millions, yet scared of a market crisis and how to benefit from a possible correction. Where do I best grow my money?

[Americanpatriot]

Real Estate provides cashflow, tax benefits, equity building, competitive risk-adjusted returns, and inflation protection on its own. Whether you invest in physical properties or REITs, real estate may help you diversify your portfolio and reduce volatility. Dividends are what got me into investing in REITs, great way to secure the accumulate wealth, I hold AMT, CCI & PSA. $290k in profits made in 2022.

[GeorgestraitStriat]

Amazing video, A friend of mine referred me to a financial adviser sometime ago and we got to talking about investment and money. I started investing with $150k and in the first 2 months, my portfolio was reading $274, 800. Crazy right!, I decided to reinvest my profit and get more interesting. For over a year we have been working together making consistent profit just bought my second home 2 weeks ago and care for my family

[askjussi]

The most important risk is management. Make sure to only invest in REITs that have good management teams. Many suffer significant conflicts of interest, especially in Canada. Stay away from REITs that are externally managed, unless they have very high insider ownership. That on its own should help you avoid many losers. I will soon cover some of the REITs to avoid on my channel. Thanks for the great video!

[UnHermitano]

I own a reit with a historic 13% ea in a non taxable account, ecah dividends is reinvested in the reit. Great investment.

[maxwells]

It is easy to understand the value of reits because the property is regularly independently valued. You can buy reits when the share price is below the Net Tangible Asset value and sell when it is above the NTA. There is also a lot of security that comes from the long leases. And it is a great way to hedge against inflation, and now we are seeing a lot of money printing.

[markcyrus]

I'm based in the UK, investing in stocks and REITs, UK-based and US-based & some shares. My US-based stockbroker allows me to invest internationally. Thanks for sharing this info!

[dustingoldsworthy]

You can buy REITS during economic downturns to maximise $ per share. Because reits have very stable values you can clearly pick up a bargain! Be greedy when others are fearful.

[robertyoung]

I was literally about to comment, "Does a TFSA protect you from being taxed on REIT dividends/distributions" until 2:38 played lol.
To anyone reading and haven't gotten to this part yet, yes the TFSA will protect you from being taxed on REIT dividends aka distributions.

[jimfarmer]

I have several RIETs in my portfolio and I have generally done well with them. But I have also taken my largest loss on any investment when one of the RIETs dropped 75% over the last year. I'm holding on to it for the time being since I think it's over sold. But I know I will never be whole on this investment.

[PierceJPeterson]

Very important point about the distributions. That's exactly why I only own REITs in a tax-advantaged account

[ariefraiser]

About 80 percent of my networth is in stocks with the rest being in bonds and the value of my house. I plan on retiring young and selling my home to travel the world rather than renting it out. Don't want to deal with the hassle of renting. At the same time I do want to have some ownership of real estate in the US and REITS fit exactly what I'm looking for. So most of the return I get from selling my home will go towards REITS.

[QuarterKnight]

Investments suck, cause I'm so addicted to them! I'm curious to check out your other videos.

EDIT: Just finished the video, thanks for the info! I've got some REIT investments already, but I must admit this was really helpful.

[sumitbasnet]

Very informative video. First channel I have subscribed to on YouTube.
Most REITs are at all time lows right now, so I bought a lot of them recently.

[ozairraja]

Great video, people always get blinded by the benefits of an investment ignoring the drawbacks. Thank you for informing us of these.

[jaymortensen]

Nice video very well spoken, I own atleast a half dozen REITS and live off the dividends I get about 5500 a month after taxes which is a pretty good income I could not get on regular stocks I did not buy them for share value just for the dividends, one of them had lowered the dividend during covid { others did too } when the share price dropped by almost 2/3 rds fortunatley I bought most of my shares in the low point and they are now up by 90% but the dividend has not returned to the pre-covid level even with the share price approaching pre-covid they did raise the perferred back up but common only went up by 3 cents this video seems to offer very possible reasons for it thanks for the insight I have been debating dumping them due to the high share price it would take me a long time to make that kind of money from the dividend alone.

[esq]

4:28 while REITs are required to distribute as dividends 90% of their net income, it means, or at least in our country Phils., the year-end income or the URE, which excludes allocations for payables. This allows a REIT to acquire (in most instances from its sponsor), real properties that cost more than its 10% net income since payments can be done in yearly ammortizations, which are excluded from its net income as payables.

[PassiveIncomeTom]

*I own a good amount of REITs. Some lowered their dividends.*