What I Wish I Knew Before Buying REITs

I have lost a lot of money investing in Real Estate Investment Trusts. Before you get started, you should know the dangers of REIT investing. In this video, I will share 5 must knows before buying real estate investing trusts! This is what I wish I knew before investing in REITs. These tips should help you select the best REITs to buy and avoid painful losses. You can access my entire REIT Portfolio by taking a 2-week free trial to my REIT newsletter, High Yield Landlord: www.high-yield...
Not all my REIT investments are successful! A good example is my investment in CBL & Associates Properties (CBL), which went bankrupt during the pandemic. This REIT bankruptcy cost me over 90%. I take a look at what went wrong and what you can learn from my mistake so that you can avoid such losses. In short, I underestimated the leverage of the REIT because I underappreciated the impact of capex spending on the flexibility of its balance sheet. However investors commonly also make other mistakes when investing in REITs. Just to name a few: they fail to identify conflicts of interest, they pay too much attention to the dividend yield, and they ignore foreign REITs.
💰 I buy all my REITs with Interactive Brokers. Earn up to $1,000 by opening an account with my link: ibkr.com/refer...
🎁 Interested in my non-REIT portfolio? Sign up to High Yield Investor for a 2-week free trial to access all my stock and bond investments: seekingalpha.c...
🧵Follow me on Twitter for real-time updates on the REIT sector: / askjussi
📩Subscribe to my new Substack for REIT analysis. It is FREE: jussiaskola.su...
Image sources: CPT, NAREIT, YCHARTS, EPRA, Canva
Important Disclaimer: I hold a position in CPT. This video is impersonal and does not provide individualized advice or recommendations for any specific person. Viewers/readers should not make any investment decision without conducting their own due diligence and consulting their financial advisor about their specific situation. This video is for entertainment purposes only and you are responsible for your own investment decisions. The information is obtained from sources believed to be reliable, but its accuracy cannot be guaranteed. The opinions expressed are those of the publisher and are subject to change without notice. This KZbin channel is managed by Leonberg Research OÜ, a subsidiary of Leonberg Capital OÜ.
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#reits #dividend #passiveincome

[@askjussi]

What REITs are you worried about? Let me know in the comment section. Thanks for all your support! All your "likes" are making a big difference and I appreciate it. Jussi

[@FxAndrej]

I only worry a little bit about CCI. I know you like them, but I don't want them to cut the dividend. No growth to preserve cash - OK, cut - no. We'll see.

[@askjussi]

@@FxAndrej If they cut, it would be because it will benefit shareholders

[@spkie333]

Realty Income and Alexandria Real Estate. Any view on these?

[@gokusun3538]

Free professional tips and picks as usual! thank you my man

[@askjussi]

Thank you for your support!

[@johngibson7693]

A wise man learns from his mistakes up not from his successes

[@askjussi]

I try to learn from both. Thanks!

[@Grovelaar]

Learn from your mistakes, and celebrate your wins 🎉

[@hansschotterradler3772]

I try to learn from other people's mistakes

[@askjussi]

@@hansschotterradler3772 That is smart

[@stevelewis7501]

This is a fantastic summary. I've also had to learn some of these lessons. But wow you've been teasing us for weeks/months now about these CEO interviews.......

[@askjussi]

We first share them at High Yield Landlord. We have quite a few there if you want to check them with the free trial. Thank you for your interest!

[@thebunnyfoofoo]

Yes. Just as excited for these interviews as I am the new Deadpool movie

[@Lanark83]

Great stuff!! Always like what went wrong rather than the unicorn and rainbow stuff.

[@Biz005]

Can you make a deep dive video on EPRT please, thanks Jussi!

[@askjussi]

Sure!

[@BWowed]

Loving NLCP. Thanks for all your great videos

[@askjussi]

I like it as well. Thanks!

[@Steve-nb9kg]

CCI - hoping the new proposal is approved. Would like to see them divest the fiber biz.

[@askjussi]

It depends on how much they can get for it. This is not the best time to be selling assets so I hope that they don't rush anything

[@sotundeoyebanji]

Kiitos Paljon Jussi. Onki kaikki hyvin? Going by your name, I know you're from here. I live in Riihimäki and would like to ask if REITS is even possibly in Suomi? What would your advice be to anyone living here who would like to invest in Real Estate? Thanks

[@Environomics.]

I didnt quite understand tthe REITs being discount net asset value, low single digit number of FFO and double digit yields being bad. You mentioend that it is overleveraged. How did you determine that it was overleveraged? How is it being priced at half of its Net Asset Value?

[@hasaanijaz145]

Thank you for sharing your honest and real insights! Subscribing to see valuable content like this!

[@askjussi]

Thank you!

[@ChrisAlexander-nr6he]

Thanx for the tips! Do you invest in quarterly dividend stocks? If so any ideas on which ones?

[@KushtrimiMalcis]

Just came across your channel. New subscriber. I’d like to hear your breakdown on Mid America Apartments (MAA) some day.

[@askjussi]

Thank you!!

[@juniormint68]

I have been in UNIT for about a year and it’s been flat but the dividend has been great. It’s definitely pretty speculative, given their history.

[@thebunnyfoofoo]

Same here. I think oddly enough heard about it in a positive light from this channel XD

[@askjussi]

@@thebunnyfoofoo I am bullish on it, but it has done poorly over the long run

[@juniormint68]

Yeah, a flat share price is fine so long as the dividend stays high. If they cut the dividend or the share price plummets I’ll have to reevaluate. But that’s the nature of the game isn’t it?

[@askjussi]

@@juniormint68 It could be. This is risky

[@juniormint68]

@@askjussi sure enough, UNIT down 30% after merger announcement!

[@lim0nes83]

Great videos and knowledge share. I have one question, maybe it could be a good subject for a video, but do you invest through brokers or trusts? I found about trust this week, and seems very promising, btw I am Brazilian leaving in Portugal

[@askjussi]

I invest with Interactive Brokers from Europe as well. Thanks!

[@lim0nes83]

@@askjussi thanks for answering me. Maybe you can do a video sharing your thoughts over investing through brokers or trust co... Seems promising at least for inheritance and taxes... ;)

[@codypilkington3324]

I’m investing into O, PLD, VICI, and MAA. What do you think of these?

[@cioofek3963]

Helo Jusii! Why do you recommend it CPT? I don't like them P/FFO. What do you think?

[@julianwhite8221]

I have added to my investment in UNITI Reit since the price drop following the merger announcement and I am now showing a 10% gain?

[@Rockiii9]

You’ve recommended UNITI in several previous vids, initially a year or so ago. It’s up 86% since then & has a 10% yield. Have you since changed your position?

[@askjussi]

I still own it and I am bullish. I am simply pointing that I invested too early in it

[@Rockiii9]

Ah, great. Many thx for your advice, Jussi. I got in at the bottom, thx to seeing your vid a few months late, & I’ve added to the position, hoping that its relationship w/Windstream remains stable.

[@Fj4LiFe23]

Hoping you're going to do a video on UNITI

[@askjussi]

we will have an update at High Yield Landlord later this week

[@HH-pv9ex]

Good overview. But keep in mind that reits weren't making money during the pandemic. So circumstances are different now.

[@askjussi]

They were. Most of them kept growing their cash flow through the pandemic

[@HH-pv9ex]

@askjussi So someone was shorting them, knowing they will rebound. 😉...But I agree, over leveraging is definitely a red flag🚩 All the points you made are definitely correct 👌

[@thebunnyfoofoo]

Thanks for the heads up on UNIT. I had them In my portfolio but will probably sell. Would like a video just on international brokers. I have Fidelity because my employer uses that for 401k match. I move my pretax contributions to 401k to my IRA for REITs and stock investments that are not offered through my 401k. If I use a different broker for foreign IRA, do you know if I could transfer from my 401k like I am doing now?

[@davidwysocki1004]

Thanks, Jussi, for an interesting video on the various factors to consider when investing in REITs. Good stuff!

[@michaelak1416]

thanks for your videos!

[@askjussi]

let me know if you have any questions

[@keeponkeepingon983]

Do you recommend avoiding Uniti?

[@thebunnyfoofoo]

No affiliate link for interactive brokers is in the description :(

[@askjussi]

Thanks for the reminder! Will add it.

[@askjussi]

It is there now

[@verderriscursey]

How much did the ceo get, thats the real question. Did he/she get a big bonus for losing your money????

[@cinekquinto2105]

Im From Poland - can i ask some materialas about Energy market Like WEC , DTE thanks

[@askjussi]

Hey sorry I am not very familiar with those names

[@roseymalino9855]

You now see the analysis flaws which resulted in losses, but could you and should you have been able to see those problems before acquisition?

[@askjussi]

I did not know nearly as much about REITs ten years ago. I could have identified these issues with today's knowledge.

[@SemenRetentionKing-k8i]

🌈🌈🌈 I am glad I own 2 retail Reits that put the costs on the tenants instead of the company. That is my kind of retail Reit.🌈🌈🌈

[@askjussi]

Which one are they? Thanks!

[@SemenRetentionKing-k8i]

@@askjussi 🌈Agree Realty and Realty Income🌈🌈🌈

[@askjussi]

@@SemenRetentionKing-k8i Thanks!

[@jairfarias4139]

I am not very worried, but my GMRE position has not been looking good. I am slightly concerned but I am hoping all my reits improve if and when the interest rates go down.

[@askjussi]

GMRE is quite a bit riskier than other REITs. Single tenant medical office buildings trade at higher cap rates for a good reason.

[@chocolatesaltyballs85]

@@askjussi you prefer HR as a medical REIT right?

[@chocolatesaltyballs85]

@@askjussi also how about UHT?

[@askjussi]

@@chocolatesaltyballs85 I think that there are better options

[@askjussi]

@@chocolatesaltyballs85 I do

[@babz5313]

Hey Jussi! So you have lost faith in UNIT ?

[@stevelewis7501]

I think he's saying he was bullish too early. At current prices it's much more reasonable, though could be a trap. I doubt there's much appreciation above current price, but dividend is enticing. Looks likely too that it will remerge with Windstream. Who knows at what price.

[@askjussi]

I have not. I still own it

[@sociallybrenden12]

Why not just invest in a REIT ETF/Index Fund, instead?

[@askjussi]

It would include the good, the bad and the average.

[@centrino538]

Do you like AHH,? And what is your fair price?

[@askjussi]

Yes I do. I think tht fair value is closer to $15 per share

[@centrino538]

Thanks ​@@askjussi!

[@studiosoho]

Hello Jussi! Thanks for the tips! I'm from Brazil and I'm following the tip about foreign REITs. I have like 50%-50% Brazil/USA Reits. In Brazil, I have some of the best REITs very well managed, in sectors like Logistics and Corporate Buildings. In USA, i got O, CTRE and REG. I think I'm too allocated to Real State. Is there some good REITs on Logistics and Corporate Buildings, with DY=~5% and healthy history?

[@BeDangerousGroup]

👍

[@riceonwednesday]

say the name: RMR!

[@askjussi]

Yes stay away from those REITs!

[@riceonwednesday]

@@askjussi I managed to jump off ILPT at 14USD "only" losing around 25%. What a waste of the most exclusive industrial assets in the whole market! (Oahu)

[@Ciborium]

Reality Income is the biggest investment failure of all time.

[@Jay-fs2yd]

Why do you think that?

[@NoVaRedacted]

?

[@LasVegasStateOfMind]

Why ?

[@bryanotieno7106]

Warren Buffet said no need to invest in real estate

[@askjussi]

That is not correct

[@JoeShenanigans]

That's funny that you say that considering he had a major investment in a reit.