A Real Estate Investment Trust (REIT) is a company that owns, and in most cases operates, income-producing real estate. REITs own many types of commercial and residential real estate which are used to generate the income through either the ongoing operations or sale of assets.
For an investor, buying into a REIT is not like buying a normal income property, rather you are buying stocks or bonds in an established company, just like you would buy shares in any other publicly traded company. Just like any stock, REITs pay out dividends to their shareholders on a pre-determined basis.
For anyone that does not have the capital to start their own real estate investment portfolio, but who likes real estate as a long term investment, then a REIT can be the perfect solution as you begin your journey into the world of real estate.