| For many years, investing in the stock
| |
| | mortgages directly to property owners or
|
| market was anything but easy. As an
| |
| | operators or by purchasing existing
|
| investor, you had to carefully research
| |
| | mortgages. In both cases, whether from
|
| which stocks to buy, decide how much
| |
| | rents or mortgage payments, a REIT must
|
| weight to give to the advice of your
| |
| | annually distribute as dividends to its
|
| broker, then monitor the ticker carefully
| |
| | shareholders at least 90% of its taxable
|
| to determine whether to hold, and when it
| |
| | income.
|
| was time to bail out.
| |
| | As with mutual funds, REIT shares are
|
| But the advent of mutual funds provided a
| |
| | liquid; shares can be sold at almost any
|
| much more hassle-free path to stock
| |
| | time. And, again like mutual funds, the
|
| market investing for individuals who
| |
| | investment is passive - the individual
|
| liked the idea of turning over the
| |
| | shareholder is only faced with one
|
| decision-making to experts. By buying
| |
| | decision: which REIT to own. All other
|
| shares in a mutual fund, the individual
| |
| | choices are left to the REIT
|
| investor placed his money in a pool,
| |
| | administrators.
|
| alongside the funds of many other
| |
| | On the other hand, a REIT doesn't give an
|
| shareowners, which was then used to
| |
| | individual owner any choice in which
|
| purchase a large portfolio of securities
| |
| | properties or mortgages are purchased -
|
| chosen by market professionals. If the
| |
| | once you invest in a REIT, you accept the
|
| fund managers did their homework well,
| |
| | decisions of others.
|
| the value of shares in the fund would
| |
| | A REIT can certainly be a good choice for
|
| grow nicely; inevitable losses from some
| |
| | an investor who's looking for a way to
|
| holdings in the portfolio were offset by
| |
| | get involved in real estate while keeping
|
| broad gains elsewhere. And the mutual
| |
| | the complexities to an absolute minimum.
|
| fund share owner had no day-to-day
| |
| | At the same time, you may also want to
|
| decisions to make, once he selected the
| |
| | look into a land investment vehicle
|
| fund that looked right for him. Finally,
| |
| | that's as hassle-free as a REIT, but
|
| mutual fund shares were liquid - the
| |
| | offers some other features as well. That
|
| individual investor could pull money out
| |
| | vehicle is LandBanking.
|
| of the fund much more easily than a
| |
| | Unlike REITs, which are primarily income
|
| conventional securities owner.
| |
| | vehicles, LandBanking is aimed at medium
|
| Today, the REIT - Real Estate Investment
| |
| | to longer-term growth. The basic
|
| Trust - brings the mutual fund idea to
| |
| | LandBanking concept is nothing new -
|
| the field of real estate investing. REITS
| |
| | acquire undeveloped real estate parcels
|
| are perfect for Individuals who would
| |
| | that are located just outside burgeoning
|
| like to position their investment dollars
| |
| | growth centers, hold the land until local
|
| to take advantage of real estate's profit
| |
| | expansion demands make it attractive to
|
| potential, but are wary of the
| |
| | developers...then sell at a solid profit.
|
| complications of conventional investment
| |
| | While you can be your own LandBanker,
|
| choices like rehabs or new construction,
| |
| | there are also LandBanking partnerships
|
| or are too busy to acquire the skills
| |
| | that make investing as hassle-free as
|
| needed to navigate the real estate mine
| |
| | REITs. But in this case, your "share"
|
| field. Instead, they can now buy shares
| |
| | will be an interest in a carefully
|
| in a REIT and let a team of professionals
| |
| | selected land parcel, chosen by
|
| navigate the mine field.
| |
| | LandBanking experts for its location and
|
| Almost all REITs fall into two
| |
| | imminent appreciation potential.
|
| categories. They are either Equity REITs
| |
| | If you don't agree with their analysis,
|
| or Mortgage REITs or a hybrid of the two.
| |
| | you can just move on to the next
|
| Equity REITS use their pooled funds to
| |
| | opportunity. But if you agree, the
|
| acquire income producing properties -
| |
| | process is simple and straightforward and
|
| residences, office buildings, shopping
| |
| | once you've become a LandBanker, you can
|
| centers...etc.. Mortgage REITs invest in
| |
| | just sit back and watch your land
|
| income producing paper, by providing
| |
| | appreciate with no hassles or headaches.
|
