It has been an interesting year for Canada’s REITs. The early part of the year was marked by weakness in Alberta, especially the office market. Demand dried up as many oil companies either went bankrupt or downsized. The rest of the year was dominated by interest rates. First rates crashed with negative rates in Japan and Switzerland making headlines. This sent the price of REITs higher. That was followed by a steady…
If you want more income, one of the first places you can explore is real estate investment trusts (REITs). They own portfolios of properties that are diversified geographically and across many tenants. Some are diversified across asset types as well. Most importantly, many REITs pay juicy distributions that can help you pay your bills. Here are a couple of ideas. NorthWest Health Prop Real Est Inv Trust (TSX:NWH.UN) owns 120…
Investors tend to focus first and foremost on gross returns. Since an investor only gets to keep their net return after-tax, tax should be an important factor when it comes to investment decisions. The most basic example of this is to make the most of available tax shelters. Most people are aware of tax shelters like RRSPs, TFSAs and RESPs, but, if you are self-employed, you can even create your…
The U.S. has offered the best growth for global real estate investors in recent years, because extremely accommodative monetary policy has made financing extremely cheap. The sector has also attracted a lot of capital flows as people started to put the money they kept in cash during the financial crisis to work. But many didn’t necessarily want to buy regular stocks, due to the uncertainties about when earnings and economic…
It seems the conversation of investing in a tax-free savings account (TFSA) becomes quieter and quieter as the months go by in a year, and the conversation is most vibrant at the start of the year. Saving and investing should be a consistent act, so I’m bringing it up again. By investing instead of just saving, you’re looking for higher returns that come with higher risk. Before thinking about what…
The global search for yield isn’t going anywhere. But since U.S. stocks are looking overvalued on several measures and the bond market is showing danger signs, real estate investment trusts are a pretty attractive option, particularly U.S. ones that should continue to perform well with a gradually improving economy. REIT dividend yields do not fully reflect the rally U.S. stocks have experienced in the past four years. Indeed, they’re remained…
The history of investing is full of cautionary tales regarding the use of leverage to enhance returns, and how it is your best friend until it becomes your worst enemy. But many times, the trigger that causes great losses resulting from leverage has nothing at all to do with the quality of the underlying investments. The story is quite simple. Let’s say there is a good idea with a fair…
The threat of rising interest rates slammed the real estate investment trust sector in 2013. For 2014, with that threat still there, it may be time to get selective when it comes to your REIT picks because double-digit returns are going to become more difficult to achieve. “We believe the Canadian REITs are at the end of a 20-year era of exceptional returns driven by declining interest rates,” said Alex…
Michael Brooks of REALPAC discusses the current state of the Canadian REIT market and prospects for 2010.