Real estate investment trusts (REITs) have seen a spike in popularity in 2017.
REITs typically purchase office buildings, hotels and other properties to produce income. The Vanguard REIT ETF (VNQ) is a hassle-free play on the U.S. real estate space with a large, well-known investment group.
REITs offer many attractive advantages versus other types of investment vehicles including:
- High yield ??? The longer-term average for REITs has been trending in the 7-8% range, well above the yield of the S&P 500 index.
- Liquidity ??? REIT shares are bought and sold on a stock exchange, which is a far more efficient and easier market than buying and selling properties directly.
- Diversification ??? REITs offer a good way for investors to spread their risk.