I recently realigned my long-term diversified retirement portfolio to skew a bit more into REITs, and specifically, REITs that paid sustainable yields above 7.5%. I was seeking to de-risk a bit from regular equities, and these were surprises I discovered on the way. REITs can have a sizable advantage over other income investments. As real estate, their underlying assets are likely to appreciate over time, even given near-term bumps. As long as tenants can pay their rent (and other expenses in triple net lease situations), and that rent pays the property mortgages, then the REIT is in good shape. Ideally, REITs have money to spare to pay out and raise dividends.
I’ve got three REITs that are high yield in nature, and they are also diversified across different industries and geographies. So while I may get hit if the entire sector suffers its usual occasional correction, I’m less exposed if those hits are narrower in nature. High-Yield REITs to Buy: Independence Realty Trust Inc (IRT), Ladder Capital Corp (LADR) and New Senior Investment Group Inc (SNR).
Source: InvestorPlace
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