Is Real Estate Investment Trusts A Good Career Path
Is Real Estate Investment Trusts A Good Career Path

“The wise young man or wage earner of today invests his money in real estate.” – Andrew Carnegie. 

Real estate investment trusts are the fastest growing sector in the finance industry. If you are a financial professional and want to invest in real estate, then a real estate investment trust might be for you. Are you thinking about “is real estate investment trusts a good career path”? This blog will give you the information you need to make a good decision.

Precap: Is Real Estate Investment Trusts A Good Career Path

What are real estate investment trusts?

Jobs in real estate investment trusts

Salary

Benefits of REIT

is real estate investment trusts a good career path

quiz

What Are Real Estate Investment Trusts?

It is a highly regulated investment firm that generates revenue for investors through real estate rather than via bonds and stocks. A real estate investment trust owns and operates or buys/sells properties on behalf of a group of investors. Real estate investment trusts own many types of commercial real estate, like office and apartment buildings, shopping centers, hotels, warehouses, hospitals, and commercial forests. 

There are three most common types of real estate investment trusts are:

  • Equity.
  • Mortgage. 
  • Hybrid.

Equity REITs:

Equity REITs are invested in properties and are considered commonly used real estate investment trusts. Here the income comes in the form of rent, especially from leasing warehouses, hotels, and office spaces. They typically pay out 100% of their income and dividends to shareholders.

Mortgage REITs:

Mortgage REITs and Mortgage Funds purchase and manage mortgages on commercial properties. The total income is derived from the difference in interest rates between the money it pays to borrow and uses to fund its loans. This type of real estate investment trust must distribute at least 90% of its income to shareholders.

Hybrid REITs:

Hybrid real estate investment trusts would manage properties and outsource the financing through preferred equity/debt.

Real estate investment trusts have mostly incorporated the hybrid form of investment In the United States. Mainly focus on real estate properties that produce income for the investors. You might work for companies that hold into properties for financial gains.

How Many Jobs Are Available In Real Estate Investment Trust

It would be an excellent decision to know what types of job opportunities a real estate investment trusts career presents to you. The best-paying job prospects in the United States real estate investment trusts industry are listed below.

Property Managers:

You will work as a property manager for a real estate investment organization. It would help if you acted on behalf of their company to find new real estate properties. You will deal with property matters, like rent, lease, and other things. When you are a professional property manager, you must become responsible for this job. It is the best-paying job in real estate investment trusts. 

Development Executives:

The question “is Real Estate Investment Trusts a good career path?” comes full circle with this chief executive job position. As a development executive, you would have a significant impact on the company. This operational position does require a deep knowledge of finance and the market because you are responsible for identifying new developing budgets and properties.

Asset Managers:

This middle-level management job position includes decision-making capabilities. As an asset manager, you need to decide which types of properties your clients should purchase. At the same time, you might also have to offer a financial deal to your client.

Acquirement/Acquisition Analysts:

As an acquirement/acquisition analyst, you will be responsible for planning, coordinating, implementing, and identifying potential real estate properties to acquire. You should also have a good knowledge of market trends to help you identify acquisition targets. You need to know how to negotiate the price, prepare agreements and guide the client through the process.

Real Estate Agent:

You can also become a real estate agent. The agent deals with the properties of the owner with the person who wants to buy(customer). You have to work as a middleman between the seller and the customer. Most people think that asset managers and real estate agents are the same, but that is not true; asset managers manage properties on behalf of their owners, and real estate agents handle the selling and renting out of properties. 

Salary

S.NOJob position Estimated Salary
1Property Managers$45,819
2Development Executives$100,000
3Asset Managers$69,701
4Acquirement/Acquisition Analysts$52,000 
5Real Estate Agent$107,512

Also read: What Is Commercial Real Estate: Know In Depth

Benefits Of REIT

Liquidy:

The shares of real estate investment trusts are easily bought/sold in the market. Real estate investment funds do not tie up cash flow.

Transparency:

Real estate investment funds listed on stock exchanges operate under the same rule/regulation as other shares for reporting purposes. This leads to very high transparency.

Performance:

As real estate properties appreciate in the long term, these investment funds have typically proven to perform well.

Dividend: 

These investment trusts are usually the best source of stable income .90 percent or more profits are returned to the investors.

Diversification:

Real estate investment trusts have a minimal correlation to other asset classes’ performance, which is an advantage when stocks are low. Real estate investment trusts outperform another type of investments regarding dividends.

Is Real Estate Investment Trusts A Good Career Path For You?

This is a common query that naturally occurs to you when looking for a rewarding career path in the real estate industry. The real estate investment trust’s full term is REIT. You are supported in owning a tiny portion of the portfolio of multi-faceted real estate by this investment trust.

One of the processes with the highest returns is real estate investment. And purchasing property is not the only way to build wealth. Healthcare and rental property investments are also contributing to increased income in the retail sector.

QUIZ:

1. Equity REITs typically earn income from

  1. a percentage of tenant sales
  2. property sales
  3. rents
  4. depreciation
  5.  

2) Investing in REITs allow the shareholder to

  1. invest in futures
  2. invest in options
  3. invest in an IRA
  4. invest in income-producing real estate

3. REITs can be traded publicly on a security exchange or

  1. non-publicly through a bank
  2. non-publicly through a broker or financial adviser
  3. non-publicly through a mortgage company
  4. non-publicly through an attorney

4. To be qualified as a real estate investment trust, _____ of income must come from real estate investments.

  1. 90%
  2. 75%
  3. 100%
  4. 50%

5. An equity real estate investment trust is one that:

  1. Finances mortgages for real estate owners.
  2. Buys common shares of other REITs.
  3. Buys income-producing real estate properties.
  4. All of the answers are correct.

Conclusion

Is Real Estate Investment Trusts a Good Career Path? 

Real estate investment trusts are indeed an excellent career path. It is the best profession if you have an interest in finance and real estate. Firstly, you must understand what real estate investment trusts stand for, then you can generate the passion and grit required to explore this career.

FAQs: Is Real Estate Investment Trusts A Good Career Path

Que1. Is real estate investment trust worth it?

Investing in REITs is the best way to diversify your portfolio outside of traditional stocks/bonds and can be attractive for their strong dividends and long-term capital appreciation.

Que2. Is it hard to sell a REIT?

Real Estate Investment Trusts are easy to buy and sell. Because most of them are traded on public exchanges.

Que3. What is the downside of REITs?

REITs have some drawbacks, like: Sensitive to Demand for Other High-Yield Assets.