Real Estate Investment Trusts

susie100March 22, 2011

I'm not sure if this is the right forum for this subject, but it seems to be the most apt. Someone has asked me to invest in a real estate investment trust. I know nothing about them. Can someone clue me in? Could it be a good investment?

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lesterd

If you know nothing about them, stay far away. Those of us in the investment industry know that REITs are for sophisticated investors. They can either be a gold mine or a total bust. Without doing alot of homework, you are playing with fire. You will never be able to learn enough to make an educated decision through this or any other forum. Hope I haven't burst your bubble.

    Bookmark   March 23, 2011 at 1:43AM
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marie_ndcal

I agree, as we lost over 5000.00 in one and that was over 20 years ago. It was recommended by our tax person then he pulled his money out, moved away and we ended up taking the loss, along with others. Never again.

    Bookmark   March 23, 2011 at 1:24PM
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dreamgarden

Someone in our family invested in one and lost 10k. An apartment bldg in Scottsdale, AZ that never finished due to the builder running out of money.

Same with another friend who's parents invested in a strip mall in CT.

I agree that this type of investment is for more sophisticated investors.

    Bookmark   March 24, 2011 at 12:59PM
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jane__ny

I like watching Jim Cramer on CNBC. He recommended a realty trust last year. We bought 100 shares at $17.00 a year ago. The price has stayed almost the same (goes up or down a few dollars), but pays 14% dividend.

I wish we had invested more in it. It has a good rating and we certainly get more with the dividend than we did in the bank.

We bought it ourselves and did not go through a broker.

Jane

    Bookmark   March 27, 2011 at 7:22PM
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lesterd

Lesterd would like to point out that spam is not allowed on this site, especially from one who registers the same day as the first post. If it's called a "game" it is definitely designed to rip off the investor.

Jane, How are you going to know if that REIT goes bad?

    Bookmark   May 9, 2011 at 7:08AM
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brickeyee

The REITs took a berating when the tax rules changed in response to their proliferation.

Their main goal was to generate paper tax losses that could be used to offset earned income.
When the caps on these offsets limited the losses that could be deducted their value often plummeted.

They are aimed at a very narrow niche market now.

best to stay away if you are not in that niche (mostly high unearned income that CAN be offset by losses in other unearned income vehicles).

    Bookmark   May 9, 2011 at 9:28AM
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jane__ny

lestard, I do some trading, on-line, through Fidelity. It is simple and I don't need a broker. Just do it on my computer. This allows me to check in each day to see what my stock is doing.

Jim Cramer has never recommended a dangerous stock. He highly recommended Annaly which is a real estate Reit which pays a high dividend. I've held it for over a year and it only fluctuates a few points, up or down. If it begins to 'tank', I'll sell it.

We have our retirement accounts with a brokerage firm and I suggested Annaly to our broker. He bought some (not alot) for the dividend in our portfolio.

When I bought it I paid $16.00 a share. It hit $18.00 today. I just got my dividend last month. Pays every quarter. I'm not complaining!

There are a few good REITS which are worth checking out. The bottom line is you have to research whatever you think of buying.

Jane

Here is a link that might be useful: some info

    Bookmark   May 9, 2011 at 7:27PM
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lesterd

Jim Cramer has never recommended a dangerous stock - HA!
Try Bear Stearns on for size. One Friday he raved over it, the next week the firm was out of business! Hey, nice call Cramer!

Good luck, Jane. Hope you can get out of that fund in time when tax rates are raised and exemptions eliminated to reduce the US deficit.

    Bookmark   May 10, 2011 at 5:43AM
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cmarlin20

Jane, I'm surprised you like Cramer.
I watch CNBC everyday, but he is too "active" for me.
Don't own any REIT's, but do like preferred stocks with dividends.
Best wishes for good investing.

    Bookmark   May 10, 2011 at 9:57AM
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