Lend Lease REITS

[abbby]

Not familiar with REITS..but would you invest ? I was told by the bank to invest in it. Experts, please share your advice.

[malcontent]

First red flag = “I was told by the bank”

Banks not only lack investment expertise, but have a conflict of interest because they are typically looking for a commission.

What % of your net investible assets are you considering to allocate to REITs?

Are these direct investments or through a fund/ETF/unit trust?

REITs are not a must for any portfolio, but allocating a small percentage is fine as long as you use a low cost ETF that you buy yourself on the SGX.

Smart investors in Singapore buy low cost, globally diversified, tax efficient ETFs on the London Stock Exchange like VWRA or ISAC using a low fee broker like Interactive Brokers.

Of course, no banker is going to recommend that, because they make no commission on such investments.

[Max Headroom]

Reits tend to do well in a low interest rate environment and since it looks like the Fed will start easing rates at some point this year, there may be some upside to Reits.

Provided of course that the US doesn't slide into recession yet, at which point all bets are off.

[tiktok]

Smart investors in Singapore buy low cost, globally diversified, tax efficient ETFs on the London Stock Exchange like VWRA or ISAC using a low fee broker like Interactive Brokers.

Curious why London not US? And what are the tax efficiencies - there's no capital gains here?

Personally I'm 100% in TQQQ (NASDAQ) but my risk appetite is rather high / long term. I use Interactive Brokers.

[malcontent]

Smart investors in Singapore buy low cost, globally diversified, tax efficient ETFs on the London Stock Exchange like VWRA or ISAC using a low fee broker like Interactive Brokers.

Curious why London not US? And what are the tax efficiencies - there's no capital gains here?

Personally I'm 100% in TQQQ (NASDAQ) but my risk appetite is rather high / long term. I use Interactive Brokers.

US situs assets held by a foreigner are subject to a hefty estate tax of up to 40%, that includes TQQQ. One guy at my company who passed away wasn’t aware and his wife was stuck paying a huge tax bill. Only the first $60,000 is exempt.

London listed ETFs do not have any estate tax complications, and most ETFs on the LSE are domiciled in Ireland, so US dividends are taxed at a preferential 15% instead of the usual 30%.

However, if you are a US person, you generally want to stay invested in US domiciled assets for tax, compliance, reporting, etc, etc.

[tiktok]

Wow thanks, didn't know that. I'll try to sell before I kick the bucket.

[malcontent]

Wow thanks, didn't know that. I'll try to sell before I kick the bucket.

A quick google search will confirm it.

[abbby]

First red flag = “I was told by the bank”

Banks not only lack investment expertise, but have a conflict of interest because they are typically looking for a commission.

What % of your net investible assets are you considering to allocate to REITs?

Are these direct investments or through a fund/ETF/unit trust?

REITs are not a must for any portfolio, but allocating a small percentage is fine as long as you use a low cost ETF that you buy yourself on the SGX.

Smart investors in Singapore buy low cost, globally diversified, tax efficient ETFs on the London Stock Exchange like VWRA or ISAC using a low fee broker like Interactive Brokers.

Of course, no banker is going to recommend that, because they make no commission on such investments.

I was enquiring about fixed deposits and the banker recommended REITS. I wasn't ready to jump into something I did not understand. She said the market only had like 1 lot (250k) for one person? Not sure how true is it, but she sounded like it was very difficult to obtain (REITS).

[malcontent]

First red flag = “I was told by the bank”

Banks not only lack investment expertise, but have a conflict of interest because they are typically looking for a commission.

What % of your net investible assets are you considering to allocate to REITs?

Are these direct investments or through a fund/ETF/unit trust?

REITs are not a must for any portfolio, but allocating a small percentage is fine as long as you use a low cost ETF that you buy yourself on the SGX.

Smart investors in Singapore buy low cost, globally diversified, tax efficient ETFs on the London Stock Exchange like VWRA or ISAC using a low fee broker like Interactive Brokers.

Of course, no banker is going to recommend that, because they make no commission on such investments.

I was enquiring about fixed deposits and the banker recommended REITS. I wasn't ready to jump into something I did not understand. She said the market only had like 1 lot (250k) for one person? Not sure how true is it, but she sounded like it was very difficult to obtain (REITS).

Sounds like you wanted an apple and were offered an orange… but not just any orange, a special orange that few can obtain, and you must pay dearly for it.

There is no special orange. Never take investment advice from bankers or any other sales people who want nothing more than to take a bite out of you. If you want risk free (or at least close to it), stick to fixed deposits. REITs are a different animal, and shouldn’t even be major component of anyone’s investment portfolio, if at all.

[Strong Eagle]

Abby, a REIT is a "real estate investment trust". It is essentially a mutual fund that invests income producing properties. Examples include office buildings, residential apartments, hotels, hospitals, or even cell phone towers.

A key feature of REIT's is that the vast majority of their income must be rental income, that is, REIT's do not hold property for appreciation. https://www.investopedia.com/terms/r/reit.asp

The value of your holdings in a REIT is dependent upon two things: the value of the assets in the REIT and the income generated. If you're invested in an office building REIT in the USA, you have a problem because there is now so much vacant office space that rents and dropped, and the value of non class A office buildings continues to drop, sometimes going upside down on their mortgages.

REIT's have tended to underperform the stock market over the last decade, so unless you know what market the REIT specializes in and that market looks optimistic (for example, I did invest some money in Crown Castle, the largest cell tower lessor in the world), I can't see getting into a REIT. I may yet rue my investment in Crown Castle.

[abbby]

First red flag = “I was told by the bank”

Banks not only lack investment expertise, but have a conflict of interest because they are typically looking for a commission.

What % of your net investible assets are you considering to allocate to REITs?

Are these direct investments or through a fund/ETF/unit trust?

REITs are not a must for any portfolio, but allocating a small percentage is fine as long as you use a low cost ETF that you buy yourself on the SGX.

Smart investors in Singapore buy low cost, globally diversified, tax efficient ETFs on the London Stock Exchange like VWRA or ISAC using a low fee broker like Interactive Brokers.

Of course, no banker is going to recommend that, because they make no commission on such investments.

I was enquiring about fixed deposits and the banker recommended REITS. I wasn't ready to jump into something I did not understand. She said the market only had like 1 lot (250k) for one person? Not sure how true is it, but she sounded like it was very difficult to obtain (REITS).

Sounds like you wanted an apple and were offered an orange… but not just any orange, a special orange that few can obtain, and you must pay dearly for it.

There is no special orange. Never take investment advice from bankers or any other sales people who want nothing more than to take a bite out of you. If you want risk free (or at least close to it), stick to fixed deposits. REITs are a different animal, and shouldn’t even be major component of anyone’s investment portfolio, if at all.

Thanks for that! I'm glad I just stuck with fixed deposit