REITs allow every investment-minded person to make money off valuable real estate, giving them access to dividend-based income and total returns (that may otherwise be out of reach) without buying, managing, or paying for a property.
These REITs give money to real estate owners and developers in the form of loans, and the interest on those loans is how they make money. They help people get the cash they need to buy real estate assets.
Like any security, the value of REITs might rise or fall according to market forces depending on various circumstances, including the state of the real estate market and the REIT's financial situation.
The success of a real estate investment trust (REIT) might be hindered by incompetence on the part of the management firm hired to oversee it. Real estate investment trusts (REITs) frequently employ leverage or borrowing money to increase the amount of real estate in their portfolios.