Residential REITs can hold virtually any collection of residential rental property, from hundreds of single-family homes to mobile home parks, boutique apartment buildings, or huge multifamily complexes.
All I am saying: I don’t think it’s right to say “REITs typically own commercial real estate not SFH”. Especially when you consider how many SFHs are getting slurped up by private equity. You don’t think they will sell securities based on these new real estate holdings?
Sorry, but its just accurate, its too difficult for a reit to buy SFH because its a bunch of transactions, and they just are not profitable and it becomes a play on interest rates and speculation. Rent on a SFH is much much lower per invested capital to multi families. That is why REITs mainly just do commercial.
The issue with SFH is just how hard and costly it is to build, not competitions with REITs or investors.
Thanks for being patient with me, and I guess it’s just semantics. But personally, when I hear something like “REITs typically don’t own SFH”, I infer it to mean that such REITs are pretty hard to find or something, not just relatively uncommon. But I understand you now.
REITs typically own commercial real estate not SFH. The big key is that the government props up real estate companies with low interest rates.
https://www.fool.com/investing/stock-market/market-sectors/real-estate-investing/reit/residential-reit/
Commercial real estate includes anything over 4-unit complexes. It really is irrelevant if a individual or a reit owns large apartment complexes.
From the article:
All I am saying: I don’t think it’s right to say “REITs typically own commercial real estate not SFH”. Especially when you consider how many SFHs are getting slurped up by private equity. You don’t think they will sell securities based on these new real estate holdings?
Sorry, but its just accurate, its too difficult for a reit to buy SFH because its a bunch of transactions, and they just are not profitable and it becomes a play on interest rates and speculation. Rent on a SFH is much much lower per invested capital to multi families. That is why REITs mainly just do commercial.
The issue with SFH is just how hard and costly it is to build, not competitions with REITs or investors.
https://www.fool.com/investing/2022/02/05/why-are-reits-going-all-in-on-single-family-rental/
And the percent that I found is they own 1% of SFH rentals. So like I said, REITs mainly just do commercial.
Thanks for being patient with me, and I guess it’s just semantics. But personally, when I hear something like “REITs typically don’t own SFH”, I infer it to mean that such REITs are pretty hard to find or something, not just relatively uncommon. But I understand you now.
There might be REITs that do exclusively SFH, I dont know, but I think that rental market is dominated by smaller landlords.