If you work in the finance industry, you must be familiar with Real Estate Investment Trusts (REITs). The real estate industry has achieved significant development these years. REITs, as the leading power, has grown further. What are REITs? How many jobs are available in real estate investment trusts? Is real estate investment trusts a good career path? Are REITs great investment choices compared to other financial instruments?
Actually, there are much more jobs than you can imagine in REITs. If you’re passionate about real estate and are interested in finance, a REIT career could be an excellent fit for you. So are you ready for the exciting world of Real Estate Investment Trusts? Today, in this article, we will explain this industry in detail. Hopefully, this essay will answer your questions.
What are Real Estate Investment Trusts (REITs)?
REITs are companies that own and operate income-generating real estate. People consider REITs a new and advanced form of investment because you can invest in real estate without actually having your own physical property. REITs can operate almost all sorts of real estate, including shopping centers, office buildings, and even hotels.
The way REITs work is pretty simple. REITs are similar to mutual funds; you can trade them on major stock exchanges. They raise money by selling shares of stock to investors. Then they use that money to buy and operate some real estate to generate income. Because the U.S. government requires REITs to distribute at least 90% of their taxable income to shareholders as dividends, they can be a steady income source for investors.
There are several different types of REITs, including equity REITs, mortgage REITs, and hybrid REITs. Equity REITs operate their own real estate properties, while mortgage REITs provide financing for real estate projects and profit from the interest on those loans. Hybrid REITs, as the name suggests, combine elements and are an intermediate form of equity and mortgage REITs.
How many jobs are available in real estate investment trusts?
In 2021, more than 326,000 full-time workers put effort into the real estate investment trust (REIT) in the United States. In addition, approximately 3.4 million indirectly related jobs were also available in the booming industry. The demand for jobs in this sector has been steadily increasing in recent years, and we can expect it to continue growing in the future.
However, the number of available jobs in real estate investment trusts can vary depending on market conditions. That being said, if you know where to look, there are still plenty of opportunities available in the industry. For instance, a quick search on LinkedIn reveals over 1,000 job openings related to REITs at the moment.
Is real estate investment trusts a good career path?
The real estate industry draws many job seekers’ attention because it offers high salaries and numerous opportunities for advancement. Working in the real estate investment trust (REIT) sector is no different. Massive jobs available in real estate investment trusts make it a great field to consider. In addition to its high job demand, the average salary in the REIT industry is significantly higher than that of real estate brokers. According to data from October 2022, a typical REIT analyst earned an annual salary of $108,164, almost twice the average pay of real estate brokers and sales agents.
However, some positions within REITs require high educational degrees and industry-specific certifications. For example, more than 30% of REIT jobs require a business bachelor’s degree for a managerial role. Additionally, obtaining a valid license and becoming a Certified Commercial Investment Member (CCIM) through the CCIM Institute is highly recommended. However, finding entry-level positions is always possible to get your foot in the door and begin your career. Here is a list of some of the types of jobs available in a real estate investment trust:
Property management is an essential aspect of real estate investment trusts (REITs), as it involves overseeing and maintaining properties. They are responsible for handling all interactions with tenants as well. Once a property is ready for tenants, the property manager takes over and is responsible for the property’s operations and maintenance for the duration of the REIT’s ownership.
People often call property managers “jacks of all trades” because they are responsible for various tasks, including screening and selecting tenants, collecting rent, solving problems, marketing the property, and releasing it when necessary. This job requires a solid understanding of real estate, finance, and communication and the ability to multitask and make decisions under pressure.
Effective property management is crucial for the success of a REIT, as it ensures that properties are well-maintained, tenants are satisfied, and the financial performance of the properties is optimized. Property management is a rewarding and challenging field to consider if you’re considering a career in REITs.
A REIT analyst is a professional who specializes in conducting research on REITs and providing recommendations to investors.
To be successful, a REIT analyst must have a strong understanding of the real estate industry. They also must be familiar with the knowledge of economic trends, changes in real estate laws and regulations, and the competitive landscape of the real estate market since they can impact the performance of REITs.
REIT analysts must have excellent analytical, research, and organizational skills. These skills are essential for analyzing and interpreting data, conducting market research, and presenting findings to investors and REIT management teams.
A bachelor’s degree in real estate or finance is a must to become a REITs analyst. Some companies may require advanced degrees or professional certificates, such as a Master of Real Estate or a Certified Commercial Investment Member (CCIM).
REIT analysts’ salaries vary widely depending on locations, experience level, and skills. According to recent data, the median salary for a REIT analyst is around $90,885.
One crucial aspect of REITs is the acquisition of new properties. Acquisition roles’ daily work is finding, analyzing, and negotiating new purchases of real estate. These professionals should ensure that transactions are completed successfully and are responsible for the outcome of the investment.
A typical acquisition manager should have a strong background in finance and real estate, ideally, hold a bachelor’s degree in finance. They should also be able to deal with high pressure and understand complex real estate transactions. Acquisition roles in REITs are well-paying, with annual salaries ranging from $97,500 to $138,300 on average.
REIT Leasing Agent
If you want to break into the Real Estate Investment Trust (REIT) industry, becoming a REIT leasing agent may be a great place to start. They play a vital role in leasing properties on behalf of REITs by showing properties to potential tenants, negotiating lease terms, and preparing lease agreements.
While this is an entry-level position, it is important to have a strong understanding of the real estate market and excellent communication and negotiation skills to succeed. REIT leasing agents should also have strong customer service skills and the ability to manage and resolve any issues that may arise.
In addition to their primary responsibilities, REIT leasing agents need to market and advertise available properties and maintain accurate records of transactions. Although they have their office seats, REIT leasing agents have more time working on-site at properties such as apartments or commercial buildings.
According to the Bureau of Labor Statistics (BLS), the median annual wage for real estate leasing agents is $46,810. While this can be lower than other REIT jobs, becoming a REIT leasing agent is a great way to get your foot in the door in the REIT industry and build a foundation for a rewarding career.
In conclusion, real estate investment trusts (REITs) is a good career path. While REITs can provide lucrative opportunities for those successful, it is also a competitive industry with high pressure and may not be suitable for everyone. However, opportunities always exist if you insist on this industry and have determined to make a difference there. Some entry-level positions, such as REIT Leasing Agents, can provide a stepping stone into the industry, and you can gain massive valuable experience and skills there.
Are REITs great investment choices?
Real estate investment trusts (REITs) attract 145 million investors worldwide. REITs can be a good investment option, particularly for diversifying their portfolio to decrease the risk. Here are some key benefits of investing in REITs:
High Profits: REITs have the potential to offer high returns since the SEC requires them to pay out at least 90% of their taxable income as dividends to shareholders. Many REITs provide over 5% dividends, while a typical stock only offers about 2%.
Portfolio Diversification: According to financial theory, adding assets to your portfolio that have a low correlation with your current assets can reduce risk. REITs provide various unusual properties for you, such as office buildings, shopping malls, apartments, and warehouses. You can use them to diversify your portfolios and decrease system risks.
Transparency: REITs are subject to strict SEC regulations. Thus, they must adhere to high levels of transparency. That can be an extra layer of security for investors, ensuring that the management does not take advantage of investor funds.
Tax Advantage: REITs do not pay corporate tax, providing investors a tax advantage.
REITs, like any investment, come with risks. REITs are sensitive to economic and market conditions. Carefully research and understand the REIT you are considering investing in before deciding.
Real Estate Investment Trusts (REITs) are unusual opportunities for those interested in both real estate and finance. With numerous jobs available in Real Estate Investment Trusts, REITs offer high salaries and enormous growth potential. While some positions may require specific educational degrees and certifications, entry-level positions are always available for those looking to break into the field. Additionally, investors can be a part of the real estate industry without owning physical property themselves through REITs. What is more rare is that the return on REITs is much higher compared to typical stocks.
In this article, we have analyzed REITs and the opportunities they may bring in depth. If you enjoy this type of articles, you can visit Canny Trading.