Hi,
If you invest in REITS do you still get the possible appreciation advantage of buying a property with leverage?
One of the arguments I read about from proponents of real estate investing is that you can take advantage of leverage by using a mortgage. So if you put 20% down on a 300k home and it appreciates by 10% in the first year you would have a 50% return in one year (If you sold or refinanced hypothetically).
But if REITS also buy on leverage, wouldn't you have the same advantage? In other words, if a REIT buys a property finances 80% of it, and 20 years later it sells it for a higher price, don't you, as a shareholder, get the appreciation from the property via a capital gains distribution?
Let me know your thoughts. Thanks
Submitted August 25, 2019 at 05:35PM by Matt1251255 https://ift.tt/2NvNU27
