Land is scarce in Singapore as it is a tiny island nation. Therefore, property rentals are generally and historically high. The Singapore REIT market can be categorised into 5 main sectors - retail, office/commercial, industrial/logistics and healthcare.
Benefits of investing in REITs:
- REITs allow investors be like "property owners" without the normal hassles of renovation, maintenance, repairs, security, collecting rental and dealing with difficult tenants. It is a more convenient way of property investment for small investors.
- REITs provides regular cash flow for investors. Most REITs in Singapore distribute dividends every quarter.
- REITs provides attractive annual yields (5% - 9%) compared to the embarrassingly-low interest rates of banks.
However, not all REITs are of good, or even decent quality. Therefore, investors must be really selective. Otherwise, you might end up like the early investors of Saizen REIT during the sub-prime crisis in 2008/2009. I do ......
