Author Topic: Help with Real Estate Investment Funds  (Read 1033 times)

NewDay1

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Help with Real Estate Investment Funds
« on: March 02, 2018, 05:05:02 PM »
Hello Mustachians - any advice on a Real Estate Investment Funds?  I'm a renter in the NorCal Bay Area, and won't be able to buy here but want to diversify my Roth IRA and small brokerage account. 

Staying away from real estate crowdfunding and ETFs right now, unless someone has a good argument for them. (?)

Looking at VGSIX, but it's a $3000 entry.  Curious if there were others out there that are good, but with lower entry cost?

Thanks for your input!

Steeze

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Re: Help with Real Estate Investment Funds
« Reply #1 on: March 02, 2018, 06:49:19 PM »
I keep my RE allocation in an ETF, REET, due to being a renter and also not in the position to be a landlord.

Fees are low, and I purchase shares commission free on TDA. Buying in chunks every couple of weeks per my investment policy.

It tracks a global reit index if you are into that. I am interested in both commercial RE and global allocation, so it is perfect for me.

Not sure the diversification is necessary though,  a total market index is sufficient for most. For me it is more of a personal interest with a side diversification benifit. I get a kick out of coming home amd telling my wife that we bought some more real estate that day.

NewDay1

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Re: Help with Real Estate Investment Funds
« Reply #2 on: March 03, 2018, 10:40:12 AM »
Thanks Steeze.   What do you think of this comment?  It was from a mustachian to a post I had about fundrise.com:

Never invest in non-traded REITS. PERIOD! Too many reasons to list in one post.
http://investingadvicewatchdog.com/non-traded-reits.html
If you're in love with real estate then invest in VNQ the index fund.

Steeze

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Re: Help with Real Estate Investment Funds
« Reply #3 on: March 03, 2018, 08:10:40 PM »
Thanks, yeah for now I wouldn't consider any private equity allocation through a platform like fundrise or otherwise. I just don't watch cash tied up in undiversified investments I don't have an easy way of getting in and out of. ETFs are great for ease of use, I don't really see much of a downside with ETFs.

REET is similar to VNQ in that it is an index fund. REET tracks the FTSE EPRA/NAREIT Global REIT Index.

https://www.ishares.com/us/products/268752/ishares-global-reit-etf 

VNQ tracks a US only index: MSCI US Investable Market Real Estate 25/50 Transition Index.

Both are REIT ETFs with slightly different flavors. REET is still 60%ish US companies, so not significantly different.






Steeze

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Re: Help with Real Estate Investment Funds
« Reply #4 on: March 03, 2018, 08:23:12 PM »
The link in your post seems pretty on point and is consistent with other information I've read about crowd fund real estate.


Mr Mark

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Re: Help with Real Estate Investment Funds
« Reply #5 on: March 04, 2018, 01:57:02 AM »
Big issue is the US tax treatment of REIT dividends as ordinary, compared to LTCG and qualified dividends:

see bogleheads. https://www.bogleheads.org/forum/viewtopic.php?t=221065

So go VNQ and hold in a tax advantaged account.