Understanding REITs: Key Challenges for Real Estate Investors
Understanding REITs: Key Challenges for Real Estate Investors Real Estate Investment Trusts (REITs) have gained immense popularity as an alternative investment vehicle for those looking to enter the real estate market without directly purchasing physical property. By pooling funds to invest in income-generating assets like residential buildings, shopping malls, and commercial spaces, REITs offer convenience and liquidity. However, despite their appeal, REITs come with a unique set of challenges that real estate investors and even real estate developers must understand to make informed decisions. We’ll explore the core challenges associated with REITs and why they may not always be the right fit for every investor especially in a dynamic and localized real estate market like India’s. Lack of Direct Ownership One of the primary disadvantages of investing in REITs is the lack of direct ownership of property. When you invest in a REIT, you’re essentially buying shares in a company t...