There
are several different kinds of REITs out there on the market and before
you choose the on for you, you need to learn about each of them. The
following are a few
of the different kinds of REITs:
Mortgage REITs
This type of REIT
is the one that will be dealing with mortgaged properties. This REIT
will purchase mortgages as investments. They will also loan money to
those who own real estate and invest in mortgage backed securities. The
vast majority of the money that these REITs make is made through
mortgages.
Equity REITs
An equity REIT will
either purchase property outright or invest in it to a smaller extent. The
money that is made through these REITs is made through rental
income.
Hybrid REITs
These REITs are a
combination of the above REITs. They will make use of properties and
mortgage in order to make the most money.
REITs are a specialized type of
investment. Each REIT will have its own focus. Some will focus all
of their investments I one area of the country and others will focus on a
specialized type of investment, like apartment buildings or offices, while
others will not choose to narrow their opportunities so much. These REITs
will invest in many different types of investments like mortgage
properties and rental properties and they will often also widen their
geographical focus.
