REITs provide a unique investment opportunity for individuals who wish to invest in real estate but don't want the hassle of being a landlord. Understanding this investment product will help investors determine whether it is right for them.

1. REITs vs.
Buying
Property:
Knowing All
the Angles

2. Investing in Real Estate
Real estate investment is a time-honored way
to protect and increase wealth. There are a
number of ways you can invest in real
estate, including buying property directly or
purchasing shares of a real estate investment
trust, or REIT. Each method has advantages
and drawbacks, and the educated investor will
study the pros and cons closely before making
a choice.

3. What Is An REIT?
The concept of purchasing a home and either
renting it out or holding onto it is fairly
straightforward, but an REIT is a less well-known
option. REITs are essentially traded securities that
represent real estate development, holding or sales
companies. These securities provide special tax
benefits and must satisfy stringent requirements to
qualify as REITs. To invest in an REIT, investors may
purchase shares of a specific real estate company
such as a property developer or an ETF that holds
shares in a variety of REIT businesses. Purchasing
shares in an ETF allows you to reduce risk by
spreading your investment around several
companies.

4. Why Choose An REIT?
There are a variety of reasons why investors may feel that an REIT is the
right investment for them, including:
• Less up-front cash needed. To purchase properties, you typically need
at least $10,000 up front for down payments and to satisfy closing
costs and associated costs. REIT investors can get in for much less.
• When you purchase real estate, you often take on a mortgage to pay
for the property. REIT investment requires no debt.

5. Advantages of REITs
(cont.)
There are a variety of reasons why investors
may feel that an REIT is the right investment for
them, including:
•
•
Liquidity. Real estate can be tough to
unload when you need cash. Selling shares
of REIT is as easy as selling stocks in a
company as REIT shares are traded daily on
markets.
Less hassle. When you invest in an REIT, you
don’t have to deal with the headaches of
being a landlord – maintenance, late night
calls, finding tenants, etc.

6. Why Choose Traditional Real Estate?
Traditional real estate investing also provides a number
of advantages that investors should be sure to consider
before making a choice, such as:
•
•
Leverage and amortization. By making a $10,000
down payment, you can purchase a $100,000
property that you can use the rents from your
tenants to pay off. Long-term, investing in property
may be more profitable than REIT investing.
Careful monitoring. When you purchase
property, you’re in greater control of your
investment than you would be if you purchased an
REIT. REIT shareholders don’t have as much say so
over the companies they invest in as property
owners have over their houses and other buildings.

7. Advantages of Traditional Real Estate (cont.)
• Tax benefits. Owning property allows you to deduct many costs such as
mortgage interest, repairs, etc. on your taxes, which can be helpful when
April 15 rolls around.
• Steady costs. Over time, you may be able to
charge higher rents, but your mortgage
payments will stay the same, increasing the
profitability of your property.

8. About Ez Landlord Forms
Ez Landlord Forms provides property owners with the documentation they need
for their work. Whether you’re renting a beach house or own several properties, Ez
Landlord Forms can save you a trip to the attorney by providing you with state
specific standard rental contracts and other documents you’ll need. For more
information visit http://www.ezlandlordforms.com.