REITs: An Easy Way to do Real Estate Investment

Indian investors can invest in high quality commercial properties like shopping malls, and office spaces without the hassle of buying and managing it directly through REITs. Real estates have always been a great investment for stability and passive income.

What are REITs?

REITs, or Real Estate Investment Trusts, are companies that own, operate, or finance income-generating real estate properties.Think of REITs as mutual funds, but for real estate. It allows investors to invest in commercial properties without directly owning it.

Instead of owning physical properties, you own shares in a company that invests in a portfolio of income-generating real estate — malls, hospitals, office buildings, warehouses, even data centers.

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Types of REITs

REITs vary based on their investment focus, the way they earn income and the kinds of properties they manage.

1.Equity REITs

It is a type of REITs that invests in physical properties such as shopping malls, apartment buildings, office complexes and industrial warehouses. They earn money  through rental income and capital increment when property values rise.

2.Mortgage REITs

This one doesn't own physical buildings. Instead, they lend money to property buyers or invest in mortgage-backed securities (MBS). Their earnings come from the interest they earn on loans. Mortgage-backed securities are a type of investment product that is created by bundling home loans (or other types of mortgages) and selling them to investors.

   How does it work?

• You invest ₹1 lakh in a Mortgage-Backed Security.

• That security is backed by 100 home loans from different borrowers.

• Every month, as borrowers pay their EMI, a portion goes to you.

• If interest rates drop and many borrowers refinance, your returns could shrink.

3.Hybrid REITs

Hybrid REITs invest in both properties and mortgages, giving you the benefits (and risks) of both equity and mortgage REITs. They earn by balancing rent and interest income.

How to start Real Estate investment using REITs

REITs allow you to invest in real estate without buying or managing property yourself. You earn income from rent and property value appreciation, just like owning real estate — but with less hassle.

1.Understand What REITs Are

2.Choose the Type of REIT

3.Open a Demat + Trading Account

4.Start Small and Invest

5.Monitor and Grow Your Investment

As we have already discussed what REITs are and its different types. Now we will focus on how to open a demat account and start investing .

How to open a Demat Account

 Demat account stands for Dematerialized account  can be opened  online in India. It is essential for holding shares, REITs and mutual funds in digital forms. Following are the steps to open an account by yourself:

1. Choose a Depository Participant (DP)

A DP is a broker or platform that offers Demat and trading services. Some popular DPs in India: Grow and UPstox

2.Visit Their Website 

Go to the official website or download their app. Example:Groww: https://groww.in

Click on "Open Demat Account" or "Sign Up"

3. Fill in Your Basic Details and Upload Required Documents

Provide the details as asked such asFull name (as per PAN card), Email ID, Mobile number, PAN card number, Date of birth, Bank account details and upload required and valid documents .

4.In-Person Verification

There will be a short video call where you will be asked for you personal details and you will have to show your aadhaar card and pan card for verification.

5.Account Activation

If everything is correct then your account will be activated in 1-2 days and login credentials will be sent via email.

Why Use REITs Instead of Buying Rental Property?

If you want to earn from real estate without the stress, big money, or paperwork, REITs are the smarter, simpler way. Here's how we can benefit from it :

1.Start Small – REITs need only ₹500–₹1,000 to begin. Buying property needs lakhs or even crores and it is not possible for everyone .

2.No Landlord Stress – No tenants, no repairs, no brokers. Professionals manage everything for you. You just have to invest your own money without going anywhere.

3.Get Paid Without Lifting a Finger – Every month you will earn your own share without any extra efforts.

4.Sell Anytime – If you feel like the profit is not that great or for a time being you are unable to invest further then you can just sell your shares and start again when you feel like.

5.Safe and Regulated – REITs are approved and monitored by SEBI. All info is public and easy to track.

Conclusion

REITs offer a smart, simple, and cost-effective way to invest in real estate without the headaches of owning property. Whether you're a beginner or a busy professional, they let you earn rental income, increase your investments, and enjoy real estate growth — all without becoming a landlord.

If you're looking for passive income and long-term wealth-building through real estate, REITs are a modern solution worth exploring. Start investing and earn without any stress!