REIT stocks
Choose from over 160 real estate investment trusts (REITs) to invest in, commission-free on the Freetrade app.
Capital at risk. Other charges may apply.
See our pricing table.
See our pricing table.
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What is a REIT?
REITs or real estate investment trusts are companies that own or operate income-producing real estate, such as retail buildings, warehouses, apartments, data centres, infrastructure or hotels. A REIT can focus on one type of real estate property or cover a mix of properties in their portfolio.
This type of investment asset can provide retail investors with a great way to diversify their portfolios and invest in residential or commercial real estate without the hassle of buying and managing the properties themselves.
Advantages
They can provide regular dividend income. REITs have to pay out 90% of their profits in the form of dividends to their investors.- Due to their lower correlation with the rest of the equity market, they can help diversify your portfolio.
- They are a much more liquid investment compared to investing directly in property.
- REITs have the potential to provide total return on investment.
Disadvantages
- Like any other stock market investments their value can go down as well as up.
- They can be massively impacted by real estate prices, which also tend to be correlated with the health of the economy.
- Even if REITs are exempt from corporate income tax, investors still need to pay tax on dividends, if they are not kept in a tax wrapper.
- Not suited for short term investment. REITs prices can be influenced by many factors over the short term, interest rates being one of these factors.
Types of REITs available to invest in
Equity REITs
These are the most popular type of REITs, and essentially act like a landlord. Their main revenue comes from rental income.
Mortgage REITs
These are REITs that invest in mortgages or mortgage-backed securities and generate their revenue from interest on their investments.
Retail REITs
They own or operate retail spaces, such as shopping malls, grocery stores or factory outlets.
Residential REITs
They own or operate residential spaces, such as apartments, student buildings or housing developments.
Healthcare REITs
They own or operate properties such as hospitals, care homes, medical offices or healthcare centres.
Office REITs
They own or operate properties such as office spaces, office parks or skyscrapers.
Industrial REITs
They own or operate properties such as industrial facilities, warehouses or distribution centres.
Infrastructure REITs
They own or operate properties such as energy pipelines, telecommunication towers or wireless infrastructure.
