5 reasons you should invest in real estate funds

REIT (Real Estate Investment Trust) in Japanese is リート. This is a fund that invests in real estate projects and breaks down the investments so that retail investors like you and me can also participate.

The reasons why everyone should invest in this fund:

1. The demand for real estate always exists, from individuals to businesses. Everyone needs a space to live and work. Shopping malls, factories, and schools also need to buy or rent space to build on. Thus, investing in real estate usually yields good returns.
2. The traditional style of real estate investment is very “brain-draining” and “exhausting”. You have to spend time and money figuring out which house/land/property will increase in value to buy and later resell. Or you have to research areas near high-demand living zones to easily rent out. And you have to rent it out for a very long time just to break even. Throughout the process from starting to making a profit, you face many risks such as being scammed, harassed, the property you bought depreciating, or dealing with problematic tenants who cause trouble; worse, if someone passes away on the property, it becomes a huge hassle and makes it difficult to rent out later. With REITs, a single click allows you to invest and avoid all those aforementioned troubles.
3. In the past, you needed several billions (VND) just to manage a real estate investment. Now, people like me can comfortably invest too. You do not need a lot of money, but if you do have a lot of money, your profits will also increase. The risks with this type of fund are also low if you choose large, stable, and reliable companies. I usually buy MUFG’s real estate funds.
4. Most REITs pay quite high and consistent dividends. By law, they need to pay out 90% or more of their total profits as dividends to be exempt from corporate tax themselves, so the income for shareholders like us is quite decent.
5. The fund has high liquidity. In contrast, traditional real estate purchasing has low liquidity: meaning you cannot quickly convert the asset into cash.
   If a life event occurs, you might not be able to manage your finances in time because you have poured all your money into real estate investment. Buying and selling land or a house usually takes quite a bit of time. Moreover, if the market is in a downturn, it is both hard to sell and hard to find a reasonable selling price. With REITs, it is still just one click to sell.

That is just a brief overview. Happy investing to you all 🥰