I own both publicly traded REITs and have shares at Fundrise (essentially a private REIT). Both have done well over the past few years but both have their drawbacks. For example, I don't like how public REITs can loose share price/value based on bears entering the market and shorting the stock (even if the underlying assets they hold have not changed). I am also fearful the public REITs are overvalued at the moment but I don't have the data to back that statement up.
For the private REITs (Fundrise, RealtyShares, etc.) they seem to focus on short term profit goals (12-36 months) and land development to increase the ROI to ~10% annually. With that comes a deal of risk (e.g. one large investment project could fall apart) and how will they earn income in 5-10 years from now if the market is not appreciation as quickly?
Are there public or private REITs that simply own a pool of pre-existing income earning properties where the owners/investors are okay with a fairly stable 4-7% cash-on-cash return annually and you don't have to worry about share price swings or overvaluation? I know the risk here is always a declining market and rent/vacancy/maintenance issues but I am okay with that if its spread out over n number of units.
I guess I am looking for an investment vehicle that is in-between owning my own rental properties (I could not personally afford enough units to spread out the risk) and joining a private REIT.
Thanks!
Submitted April 10, 2017 at 11:14AM by Pennysboat http://ift.tt/2oRoznH
