Everything You Need to Know About Residential REITs

Real estate investment trusts are crucial if you work diligently to build an equity or fixed-income portfolio. They offer incredible diversity great returns, all at very low risk. They help individuals generate a dividend income while they appreciate, making them a great alternative to investing in stocks or bonds. Don’t even think about putting your money away in the form of cash because cash, when it sits idle, depreciates, and that is not something you want. 

With the help of a reliable real estate agent and an online broker, you will be able to invest your hard-earned money into real estate investment trusts. 

REIT is a specialized kind of company that deals with real estate assets. These companies that also invest in commercial properties are known as equity REITs. REITs that invest in mortgages and mortgage-backed securities are known as mortgage REITs. 

Residential REIT

A residential real estate investment trust owns and operates rental properties, including urban high-rise and low-rise apartment buildings. Their focus is mainly on owning properties that appeal to single families and students.


Residential REITs focus primarily on developing new properties from the ground up; then, some grow through acquiring new properties. Both forms of residential REITs increase the value of properties by buying in. Some REITs also do a combination of both. 

Investing in Residential REITs the Right Way

If you’re looking for a short-term investment, residential REITs are not ideal for you. However, if the long-term investment is more your thing, you must invest in residential REITs the right way. In the short term, REITs are impacted by the housing market, but the impact is not as severe over long periods. If you’re investing in REITs, plan for a minimum of 5-years ahead as an investment. 

Residential REITs Offer Diversification

You can easily diversify your portfolio with residential real estate investment trusts. Try to invest in multiple ventures and not tie all your money in stocks because when they slump, as they often do, so will your spirits. When you invest in residential REITs over a long period, a portion of your investment portfolio will continue to appreciate and be secure. 

Residential REITs resist Recession

If you’re looking for an investment protected from the recession, then residential REITs are the way to go. Even if the economy is in the gutter, people will always need places to live in, and as such, will want to either buy or rent. This has less to do with unemployment and more to do with basic needs. 


So, have you made up your mind and would like to learn about whether or not the residential REITs are your next investment option? It might help to get in touch with a realtor to discuss your options. It is better to do this sooner rather than later so your realtor can lay out all of your options in front of you and help you make an informed decision.