Thursday, December 4, 2014

A word of caution on REIT

REIT stands for "Real Estate Investment Trusts". 
It has been very popular in Singapore!
 
However, I would caution people not to put too much money into REIT, for below few reasons:

1) Most people in Singapore are already invested in property / real estate (through owning their own residential property), so there is no reason to own more property assets. 

2) Buying more REIT on top of self-owned property is like putting more egg into same basket.  It is better to buy stocks in other business sectors to diversify the investment risks. 

3) If you want to invest in more property / real estate investments, it is better to buy the property on your own than to own it through REIT.  This is similar to buying stocks directly ourselves than buying unit trusts!  By going through a middleman, most of your profits would have been "eaten" up by the middleman and ultimately what you get back will be mediocre! 

No comments:

Post a Comment