Let’s help you answer this recurring question in the minds of today’s job seekers. And that question is, ‘is real estate investment trusts a good career path.’
Choosing a career path in life is a very important decision because it affects every other thing about you. That is why it is recommended to do your due diligence before choosing a path. You will want to weigh the pros and cons of the career before choosing it.
If you are presently searching for areas to choose a career, you must have come across real estate investment trusts (REITs). Do you also ask, ‘is real estate investment trusts a good career path?’ you are not alone.
REIT has been around since 1960 and it is presently one of the fastest-growing fields in the financial industry. If you are a financial professional and looking for a way to diversify your portfolio and invest in real estate without the hassle of having to manage properties yourself, then you should consider real estate investment trusts. At the same time, if you are considering picking a career in the field, working with firms and companies in the industry, this article should guide you.
Table of Contents
First, What Are Real Estate Investment Trusts?
Real estate investment trusts (REITs) are public companies regulated by the U.S. Security and Exchange Commission. What they do is that they buy, sell, and own commercial properties from which they can generate some income. Many investors and financial professionals invest in real estate through REITs.
REITs offer them the opportunity to invest and enjoy the opportunities in real estate without having to manage any properties themselves. However, REITs are not one; there are different types. And the most common are equity, mortgage, and hybrid. Let’s see what each of them is before we move into answering the question, ‘is real estate investment trusts a good career path.’
What Are The Different Types Of REITs?
As we said, there are different types of real estate investment trusts in the market. The common ones are:
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Equity REITs
Firms here own some commercial properties they can either manage themselves or subcontract out to another firm. They make their income from the rents paid on those properties, and also from the profit they make when such properties are sold. They typically pay out the whole of their interest to shareholders.
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Mortgage REITs
These real estate investment trusts buy and manage mortgages on commercial properties. They generate their income from the difference in interest rates between the money it gave out as loans to acquire the properties.
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Hybrid REITs
Firms here buy and manage properties but give out the financing aspect to some other company. This reduces taxes on the company, and at the same time, helps them to concentrate on just making money from rental income.
Is Real Estate Investment Trusts A Good Career Path?
Let’s take the time to answer this question. While REITs offer a good investment option for people looking to diversify their portfolios, we also need to see if it provides a good career path for people looking to pick a career in the field.
Many colleges and universities today now provide degrees or even a master degree in real estate which can help students land a job or career opportunity in real estate. This includes programs in commercial property management, brokerage services, accounting for real estate, design of commercial buildings, etc.
Picking up a career here means you will likely be hired by one of the firms in the industry where you will be responsible for finding properties and overseeing their day-to-day operations. That’s the most common type of job in the industry. However, there are also some other entry-level job positions in real estate from which you can build a sustainable career.
There are many benefits associated with working in real estate investment trusts. First, you will most times be working as a contractual worker. That means you can run your business on your own terms and rules. Also, instead of getting a monthly income, you will likely be getting paid based on your contribution to every sale and profit. It allows you to travel to different locations, and your job is not restricted to 9 to 5.
What Are Some Career Option In REITs?
There are many job opportunities in the field, with each of them offering different benefits and perks. Some common ones include:
#1: Property manager
These people work on behalf of the real estate company to find real estate properties. If it is a big company, then we can have positions like the senior manager who oversees multiple locations. And that makes it one of the top career paths in the industry. A property manager earns an average of $45,000 — $59,000 per year.
#2: Development executives
This is one of the top-paying positions in the REITs industry. At the same time, it requires a lot from the individual occupying the position. That includes having deep knowledge about the market and properties in the community they operate. As a development executive, you will be responsible for identifying opportunities for new properties while also making budgets for future projects. It is an important position in the industry. A development executive earns an average of $100,000 per year.
#3: Asset manager
This person is in charge of identifying and deciding if a property is worth buying or not, and how much debt is needed to finance the deals. They also manage and oversee property operations to make sure expenses are in line with revenue projections. That makes the position one that requires extensive experience in the real estate market. The average income of an asset manager is $50,000 per annum.
#4: Acquisition analysts
This professional is responsible for sourcing, identifying, coordinating, planning, and implementing potential properties that would be good buys for the company. They are usually in charge of finding good deals, negotiating prices, preparing agreements, and many more so the company can purchase the property. The average salary of an acquisition analyst is $53,000 per year.
#5: Real estate agent
This is perhaps the most common job opportunity in the industry. Generally, real estate agents deal directly with the property owner and the person who wants to buy. They act as a middle man between the buyer and the seller. As a real estate agent with a good name, you can earn up to $50,000 in a year.
How Do Real Estate Investment Trusts Make Money?
Perhaps you are wondering how the firms in the field make money. Companies there make money in two major ways. First is through the revenues they make on their properties after taxes and other expenses have been deducted.
Another way they make money is through the sales of shares to investors who receive a form of dividends based on earnings.
Is Real Estate Investment Trusts a Good Career Path; Final Note
Now you have the answer to the question, ‘is real estate investment trusts a good career path.’ Again, the answer is yes. The field does not only provide a good investment option for investors, it can also be a good career path for job seekers. Working in the REITs means you are your own boss and your job is not confined to certain hours of the day.
You can choose areas you are most interested in and pour in your energy to get to the top. Jobs there pay well and you are the only barrier to how much you can earn at the end of the year. That’s because jobs there are mostly not based on salary but dividends from sales and according to your contribution to the sales.
If you are enthusiastic about the real estate industry, then picking a career in real estate investment trusts may be a good one for you.
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