facebookIf I wish to invest in commercial or industrial, would REITs be an equivalent instead of owning the property directly? Are REITs a better choice compared to property investment? - Seedly

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Anonymous

26 Feb 2020

Property

If I wish to invest in commercial or industrial, would REITs be an equivalent instead of owning the property directly? Are REITs a better choice compared to property investment?

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I did a simulation by comparing owning a physical industrial property vs buying REITS, the result show that if u can get above 6% yield from REITS, then it's better than owning physical pty. Plus there r many risk associate with physical pty like vacancy rate, gov ruling, ageing property, rental default. All these will eat into yr return.

Reits is a better choice if you do not have enough capital to buy a second property. Investing in reits allow you to own a part of many different buildings and collect rents from them.

Ryan Ong

Ryan Ong

11 Jun 2019

Partner at Stacked Homes

Property provides a higher degree of leverage, given that you can get LTV ratios of about 70% quite ...

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