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I Ditched Real Estate Investing for REITs and Here's Why

  Рет қаралды 5,766

Jussi Askola, CFA

Jussi Askola, CFA

Күн бұрын

Пікірлер: 73
@askjussi
@askjussi Ай бұрын
Make sure to subscribe to the channel as I will soon discuss some of my favorite REIT investment opportunities for 2025. Thank you for all your support and let me know if you have any questions.
@macjackslack
@macjackslack Ай бұрын
I love when you talk about this. Your interview on Bigger Pockets is my favorite episode.
@askjussi
@askjussi Ай бұрын
Thank you for your kind comment!
@MartinD9999
@MartinD9999 Ай бұрын
100% correct: The time and labor of personally dealing with rentals is a huge factor in calculating your costs/returns. If you’re not adding the time and labor you spend with your rentals, you’re working for free or ignoring that aspect of the investment. I will pay a group of professionals to manage and maintain my properties so I have time to do as a damn please every single day and night instead of answering phones and driving to hardware stores and properties. Even if the actual cash on cash return is smaller, time will ALWAYS be more valuable. If a person hasn’t learned that in life, they haven’t understood the concept of living off their own investments.
@askjussi
@askjussi Ай бұрын
Yes, people are essentially buying themselves a low paying second job and a good chunk of the returns actually comes from their own labor.
@LjErickson
@LjErickson Ай бұрын
Great video. I finally subscribed to your high yield landlord service. Appreciate all your videos. Look forward to seeing more of them
@askjussi
@askjussi Ай бұрын
Thank you for your support! Let me know if I can help with anything as you get started
@muffemod
@muffemod 15 күн бұрын
It's your best video because it's a great video!
@jonathantaylor426
@jonathantaylor426 Ай бұрын
Excellent video, Jussi. I am a huge fan and RIETs. You have saved me from lots of headaches with tenants. Thank you.
@askjussi
@askjussi Ай бұрын
Thank you for your support!
@tymoed
@tymoed Ай бұрын
I absolutely agree especially if you’re looking to take out a loan, you have more flexibility when calculating the cashflow because u can borrow against your reit from different currencies, like jpy or Switzerland without even visiting them so your spread is probably gonna be higher if u take this route, also u can sell it at any time, nowadays people are terrified to buy houses due to the prices so it might be hard selling which is why u see a lot of owners post their mansions on KZbin for sale because the prices are absurd.
@askjussi
@askjussi Ай бұрын
Thanks for sharing your thoughts. Yes, you can take additional leverage on REITs if needed
@tvlookplay
@tvlookplay Ай бұрын
Great video. 👍
@joeybru
@joeybru Ай бұрын
@Jussi Perhaps one day you want to look at the German/Austrian situation. In D capital gain on stocks is taxed 26.1% (stock funds only 19%) - however, leveraged properties can generate costs that SAVES you from some tax on your normal income (above 66k of which is taxed with 42% ). Perhaps worth to develop some strategies for this situation.
@jaxxtraxx
@jaxxtraxx Ай бұрын
Great video
@ukikiki7034
@ukikiki7034 Ай бұрын
Hi Jussi. Thank you for all valuable content that we receive. I want to ask about area that you havent mentioned recentlt. What do you think about DEA and similar reits( gov rent properties). Thank you
@tymoed
@tymoed Ай бұрын
I do understand why people preach real estate but are scared of reits, it’s simply due to the fact that you can see the numbers and the risks on the screen and the market so it’s overwhelming for most people due to fear, but it’s actually easier than managing a tenant or spending a portion of your income on a property management firm/team, as someone younger I’m going right to reits and later I’ll go to real estate because real estate is like a safety net in a way.
@askjussi
@askjussi Ай бұрын
Yes it is not very rational
@Sylvan_dB
@Sylvan_dB Ай бұрын
Every time I've tried to pencil out the potential of direct real estate investing, I have reached the same conclusion: Risk, work involved, vs the probable reward simply doesn't work for me.
@tymoed
@tymoed Ай бұрын
Yeah it’s just not realistic nowadays, the people who recommend real estate,bought theirs for 2 nickels and a dime.
@askjussi
@askjussi Ай бұрын
In some particular cases, it can still result in very strong returns. REITs just do better in most cases
@LFTRnow
@LFTRnow Ай бұрын
This is a well-thought out video and I generally agree, but I think both have their place. REITs make sense when you want to be more hands-off, and as for tax calculations, I'd recommend buying them in things like a Roth IRA so they aren't an issue. The "subprime" stock crash, drove many to hands-on investments like rentals. Rather than going to sleep with a stock at 20 and waking up next day with it at 4, and having the CEO happily drift way to safety on a multi-millions golden parachute (and these were REITs!) a bit of manual effort starts to look more attractive. Related to that, all you need is a good stock market crash and your REIT portfolio is now 1/2 or 1/3rd its original trading value. If you own property, you get that leverage on your own terms, and there's probably no tax cost until you sell and even then, in the US you have 1031 exchanges as an option. Finally, anything you buy for your business is probably tax-deductible, like computers, car expenses, home office, etc. It makes sense to have both, but if you want (mostly) hands-off income, the only option would be REITs, and they are generally a good option for all of the reasons you listed - as long as the company isn't mismanaged and/or the market has a massive subprime crash.
@askjussi
@askjussi Ай бұрын
Thanks for sharing your thoughts. Remember that tons of real estate investors lost everything during the great financial crisis. It is not just stocks or REITs that suffered. Everything crashed. I just think that REITs are more rewarding over a full cycle and that's despite requiring far less efforts. But yes, private real estate can still make sense in exceptional cases. I will film a video on that topic soon.
@tombostock5992
@tombostock5992 Ай бұрын
Another great video! One question, how much of your portfolio is invested in REITs?
@askjussi
@askjussi Ай бұрын
I invest about 50% into REITs. I like to invest in what I know
@thebunnyfoofoo
@thebunnyfoofoo Ай бұрын
Jussi is lit like a super villain in this vid.
@askjussi
@askjussi Ай бұрын
🤣🤣
@User677-56
@User677-56 11 күн бұрын
Cool like James bond
@thebunnyfoofoo
@thebunnyfoofoo 11 күн бұрын
watch out for dark Jussi XD
@borisalbert1117
@borisalbert1117 Ай бұрын
Thanks for the great video Jussi 🙏🏻 do you know why safestore stock is going down so much? Is it maybe a buying opportunity? Have a nice week 🙋🏻‍♂️
@askjussi
@askjussi Ай бұрын
All storage REITs are dropping lately. We prefer one of its close peers
@ronpizur2627
@ronpizur2627 Ай бұрын
You did a fantastic job rebutting your detractors points. Hopefully they will now see the light. Another reason to invest in REITS is diversificaiton across property types. I am thinking that a lot of your detractors are small investors who primarily invest in residential properties. But with REITs these investors with limited capital can also become landlords in many differnt types of properties other tha just residentail properites.
@askjussi
@askjussi Ай бұрын
That is a great point. And also across countries. Thank you for the addition
@mikethomas5210
@mikethomas5210 Ай бұрын
Excellent job. I will now buy REIT investments and not be afraid of them.
@askjussi
@askjussi Ай бұрын
I appreciate your interest
@davidwysocki1004
@davidwysocki1004 Ай бұрын
Thanks, Jussi, for your excellent presentation on the case for investing in REITs vs rental properties. Your presentation is spot-on! Good stuff!
@askjussi
@askjussi Ай бұрын
Thank you for all your support David
@peaceful4you408
@peaceful4you408 4 күн бұрын
I’m a real estate investor but I invest in real estate syndication. Take my advice. Invest in REITs. REITs are by far much better and much more lucrative in so many ways there’s really no comparison. There’s no overhead or maintenance expenses with repairs you have to worry about with REITs, you don’t have to go through the headache of taking people to court for not paring rent with REITs, you don’t have to worry about civil issues with tenants, you don’t have to pay insurance or mortgage expenses with REITs, and just a ton of other things. REITs save you a shit ton of money which allows you to put a lot more money back in your pocket. Real estate investors dont take much home after we deal with all the shit we have to deal with. REITs are by far way less headache. I own REITs too. In fact, I have about $300,000 invested into the REIT stock symbol O. I make almost 3 times the income from my REIT than I make from my real estate properties that I have over $1 million invested. There’s no comparison. Trust me. Take advice from someone like me that is on both sides of the fence.
@askjussi
@askjussi 4 күн бұрын
Thank you for sharing your thoughts!
@hallowiegehts9227
@hallowiegehts9227 Ай бұрын
I was thinking about buying a small flat and renting it out here in Germany. But the calculations make no sense right now. A trash ass property 1 room apartment costs up to 200.000 Euros. Where you additionally need to renovate it completely. High reparation costs. In order to get 600 euros rent for some people making the hell out of your life with complaints. I will stick to Reits for now as well.
@askjussi
@askjussi Ай бұрын
Yes and REITs are discounted on top of that. It just doesn't make sense
@laurataylor-c2x
@laurataylor-c2x Ай бұрын
Very informative video! By the way: I have the OKX Wallet with USDT, and I have the seed phrase. (job priority warm lab border boil monkey manage palace fiber weird ask). What steps should I take to transfer them to Binance?
@AarniJunkkala
@AarniJunkkala Ай бұрын
Hei Jussi! Where did you invest to real estate? Usa, Europe? Major cities or smaller places? How long did you invest to real estate before you changed to reits?
@askjussi
@askjussi Ай бұрын
I worked in private equity real estate in Texas
@cal50x
@cal50x Ай бұрын
Well, in Real Estate I cannot invest small amounts of cash like 100$, in REITs I can... Easy answer :)
@RogerYeahmon
@RogerYeahmon Ай бұрын
Could you clarify which country's tax laws you are describing in the "tax efficient" section? The laws you mention do not match those in my country so I'm guessing ths video was not intended for me.. Don't forget tax jurisdictions differ from country to country..
@askjussi
@askjussi Ай бұрын
Which law does not apply to your country? Thanks!
@TomCastro22
@TomCastro22 3 күн бұрын
Thanks for your efforts Marketfeed, very interesting and useful Video, I like the way you have explained stocks, you are just like my Mentor, her strategies helps beginners to earn in the market without loss.
@SteveJeffrey6
@SteveJeffrey6 3 күн бұрын
I have invested in bitcoin myself. I am not really happy with what is happening right now. Just a few weeks ago I lost about $7,000 on a certain transaction. Can you help me or at least give me some advice on what I should do?
@AnnieGulla
@AnnieGulla 3 күн бұрын
Someone like Ms. Larissa Riddick, who understands the market very well and is a pro at closing deals, is essential.
@LarryJodan
@LarryJodan 3 күн бұрын
Does it also offer mentoring, conferences and tutorials? How can I contact her please and on which platform can I find her please
@AnnieGulla
@AnnieGulla 3 күн бұрын
She's on Telegrams
@AnnieGulla
@AnnieGulla 3 күн бұрын
@expertLarissa her name
@dans5916
@dans5916 Ай бұрын
How much of your recommendations and portfolio is for REITS outside of USA? As a non US investor, withholding tax on dividends is 30%, which obviously is insane. I would be interested in subscribing if you also focus on global markets. Very interested in your opinions on IRSA (Argentina) and EMAAR (UAE).
@askjussi
@askjussi Ай бұрын
It should be 15% after you sign some tax forms and you get a tax credit to avoid double taxation in most cases
@dans5916
@dans5916 Ай бұрын
@@askjussi Only in some countries. I am resident of Monaco and I don't believe we have a DTA. Countries without a DTA with USA are at 30% - is my understanding.
@SupportSuccessAcademie-cj1ss
@SupportSuccessAcademie-cj1ss Ай бұрын
Same question for me, I'm a UAE resident and don't pay any taxes. Why would I invest in US Reits and get taxed 30% on the dividends? How can It be more profitable than investing in my own flats? This is the only thing that is stopping me to invest and subscribe to your newsletter. For the rest, everything makes sense. To make it simple, does it make sense for a UAE resident to invest in REITS due to the 30% tax? Thank you in advance for your potential answer.
@dimitriburri7006
@dimitriburri7006 Ай бұрын
Good Vidéo, I can't understand why Alexandria crash, good result, I Will definitely buy again this blue chip
@askjussi
@askjussi Ай бұрын
Thanks! I agree that ARE is attractively priced
@KO-gj9ug
@KO-gj9ug Ай бұрын
I made most of my wealth through real estate and have recently been almost 40% in REITs. I highly disagree with your statement about leverage in your first point. An individual can receive half a million dollars in leverage (in low interest rate environments) with zero down. A REIT investor may need 100k of capital to reach that amount of leveraged cashflow from a REIT (using your proportions in the video), but the issue is obtaining that initial 100k. It may take an average person 5-10 years to save that much to begin getting those cashflows.
@askjussi
@askjussi Ай бұрын
You cannot buy rental properites with zero down. Those days are over.
@malceum
@malceum Ай бұрын
In practice, REIT investing doesn't seem as good. As a quick example, the average single family home in the US appreciated 30% from 2020. The leading US single family home REIT (INVH) actually lost value during this time, while paying a measly 3.3% dividend. Someone buying a home could more safely use leverage than someone buying a REIT on margin. Something you also overlook is that managers of REITs often have conflicts of interest with investors. They might be incentivized to grow assets even at the cost of acquiring poorer assets. MPW is a prime example. When you own real estate, you don't have to worry about others putting their interests above your own.
@askjussi
@askjussi Ай бұрын
That is a very short time period. REITs are in a bear market. That is precisely why they are so attractive today. They are heavily discounted relative to the value of the real estate they own. MPW-like situations are exceptional in the REIT sector.
@thomas49th
@thomas49th 15 күн бұрын
is the chart kzbin.info/www/bejne/eZLYdWegnaxsf5Isi=QYftF-QfooRTFOuq&t=576 showing the (internal) rate of return with debt financed properties or rate of return on non-financed properties? also chart seems a little dated, finishing in 2010
@torgnyandersson403
@torgnyandersson403 Ай бұрын
You can get even more leverage on REITs than real estate, because you can buy stock on margin, if you like that kind of thing.
@askjussi
@askjussi Ай бұрын
Right but the margin is just optinal. REITs are already leveraged
@SupportSuccessAcademie-cj1ss
@SupportSuccessAcademie-cj1ss Ай бұрын
Hi Jussi, i hope you're well and thanks for your content. You're about to win a customer to your newsletter if you can explain to me how REITS can be interesting for me as a UAE resident not paying taxes. I'll be taxed 30% on my dividends compared to 0% on private rental. For example, I feel like getting 5% (on let's say 100k invested) in dividends and then removing again 30% is leaving me with little. Of course the stock can gain value over time, but this would be same as any other stocks. To make it easy, are US Reits interesting for residents of countries not paying any taxes? Thank you and have a great day!
@askjussi
@askjussi Ай бұрын
Thanks for your interest! I am also abroad and pay withholding taxes. That is fine. Remember that the dividend is just one small component of the total return. REITs retain a lot of cash flow which is not taxed. And in the coming years, the bulk of returns is expected to come from growth and upside since REITs are today undervalued. I would add that I would rather pay 30% on a great investment than pay 0% in a potentially less desirable market with oversupply and other risks. Even if it is just for diversification. Let me know if you have other questions
@williebrown1974
@williebrown1974 Ай бұрын
For a Joe Schmo like myself I agree REITS are better. Birmingham, ALA has has crushed me and I'm working 2 jobs just to make ends meat.
@askjussi
@askjussi Ай бұрын
Thanks for sharing!
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