REITs: Real Estate Without Toilets

Don't want to be a landlord? Real Estate Investment Trusts (REITs) let you invest in real estate through the stock market. You buy shares like any stock, and REITs are legally required to distribute at least 90% of taxable income as dividends.

REITs own everything from apartment complexes to data centers to cell towers. You can buy into a diversified REIT index fund with a tiny amount, sometimes the price of a single share. No tenants, no maintenance calls, no property management headaches.

Over long periods, REITs have delivered returns roughly in line with the broader stock market. The trade-off: you lose the leverage of a mortgage and the tax benefits of direct ownership.