Saturday, February 28, 2009

REITs - Real Estate Investing Made Easy

Eco Friendly Real Estate Investing

There are a lot of people who well understand the importance of taking a note of the carbon footprint they are leaving on the planet these days. Some of these same people would love to be members of the investment market, but worry about the impact they may be having on the planet, especially if they are thinking of investing in real estate.

Believe it or not you can make money investing in real estate and still be green. You just have to know how to do it and where to look.

These days many real estate investors are putting their money into real estate investment trusts (REITs). A REIT is essentially a fund that allows a company to either build or manage a real estate entity. Essentially you are purchasing a share of that entity whether it is a home, apartment complex, shopping mall or industrial warehousing complex.

The way you make money on a REIT is through profits from the property. For example, if it is a commercial real estate property, when the tenants pay their leases, the profit from that (or at least most of it) is returned to the investors in the form of dividends, just like you would get on other stocks and bonds.

While this all may be well and good as an investment strategy, you may wonder how you can use this investing tool as a way to be eco friendly. Well, that's simple. There are a lot of real estate management groups that specialize in eco friendly and green construction.

The fact is that new construction will always be necessary. With the rate the population is growing, there will always be a need for new homes and businesses to support them. But the key is in making sure that new ventures are being as friendly to the environment as possible.

When you are researching the REITs to buy into, look for properties that have worked to be more sustainable such as those that have a number of energy saving measures and others that conserve water. You may also want to look for those that have been created with environmentally friendly materials and methods of construction.

It's not that hard to find these types of companies. You can go to a company like and look up REITs that are specialized in this way. On you can even continue through the process and purchase the REITs you are interested in.

These days companies are bragging about their construction methods and maintenance plans to be more environmentally friendly. A lot of people will be happy to pay good money to live in such eco friendly places. That is money that will become a part of your profit if you are investing in REITs that support eco friendly construction.

The other thing to think about when it comes to profitability from green buildings is that not only are these buildings more attractive because of that designation, but they are also improving your bottom line in another way. The more sustainable the building is (i.e. less power use and water use) the lower the monthly costs to manage and more profit that can come back to you.

While on the front side green building can cost 2-3 percent more to build than traditional structures the impact on the environment and your bottom line will be worth it in the years to come.


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