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Updated almost 8 years ago on . Most recent reply

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Andrew McIntyre
  • Riverton, WY
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Need advice on REIT vs Buy and Hold investing

Andrew McIntyre
  • Riverton, WY
Posted

Let's say I have 50k. Would the cash on cash return be the same if I invested with an REIT route compared to the 50k being a 20% down on a multifamily buy and hold using a property manager?

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Bill F.
  • Investor
  • Boston, MA
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Bill F.
  • Investor
  • Boston, MA
Replied

@Andrew McIntyre Depends on a multitude of factors. The underlying assets of the REIT and their yield playing the largest role. You can find that out from the REITs 10k reports.

Where would you buy the multi? If you have a property picked out its easy to run the numbers and compare them to the performance of the REIT to get a rough answer. Big disclaimer here: just like you don't drive a car looking through the rear view mirror only, neither should you invest your money solely based on a securities past performance.

In general, REITs behave and are valued like equities and have the same advantages and limitations ( you don't get tax advantages and amortization but they are passive).

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