YieldSavvy – Your Hidden Tool for REITs Investing
Instead of chatting about my usual weekly blog posts, let’s talk about Real Estate Investment Trust (REITs). A few days ago, I went through the emails from all of you.
One thing stood out.
Most of you are looking for passive income.
You’re sick of buying into companies with falling or unstable dividends.
You have invested in some popular names such as SingPost, Singapore Press Holdings, Singtel and Starhub. Over the years, they were unable to increase or maintain their dividends.
Extracted 5 June 2019
(RELATED: Starhub – Is the Dividend Yield Sustainable?)
This meant that you do not have certainty of a steady passive stream of income. What’s more, you are frightened by other forms of “investments” that involved promising (scamming) you with unrealistic promises of high-yield, guaranteed, and monthly income.
While there are risks in all investments, for my friends around me, I often tell them that REITs is your ANSWER. It is the simplest structure to invest for passive income.
Extracted 5 June 2019
Do not over complicate by investing in a dividend-paying company because a company is different from a REIT.
What’s a REIT?
REIT is an collective investment structure where investors pool their money together.
REITs invest in real estate properties such as shopping malls, and distribute the rental income every quarter to unit holders. REITs are professionally managed by managers and the assets are safeguarded by an independent trustee.
The entire structure is heavily regulated by Monetary Authority of Singapore.
REITs are obliged to distribute up to 90% of their property income back to you!
To keep it very simple, imagine, Terry purchased 100 shares of Frasers Centrepoint Trust (FCT) at $2.52.
The capital outlay is $252 excluding brokerage commissions.
By investing $252, Terry is a partial owner of 6 properties. As the rental is collected from the tenants of the 6 properties, the rental is distributed proportionately as dividends in every quarterly.
Assume FCT gives a dividend yield of 5%, Terry will receive $12.6 (5% multiply by $252).
It is simple like that, a REIT cannot buy anything else except for properties.
A Tool for Investors – YieldSavvy
I love the tool because it is free, easy to use and it contains relevant information!
I am not affiliated to YieldSavvy and I do not have any commercial/personal relationship with the founders of YieldSavvy.
Step 1: Open An Account
Go to https://app.yieldsavvy.com/member/register/ and create an account.
Step 2: Sign In, Go to the REITs Screener
After you have signed in, go to https://app.yieldsavvy.com/reits/singapore/basic/
You will see the entire list of Singapore REITs such as Frasers Commercial Trust, Mapletree Industrial, CapitaLand Retail China and others.
Step 3: Learning how to Filter
I have done a video to guide you through the process, watch the video closely below:
This would solve most of your headaches of finding where to get your information!
CAUTION: Companies with very high yield may not be sustainable, you need to check the Distribution per Unit (DPU) trend for consistency.
Closing
I recognise that there may be a few of us who are new to REITs. I am in the process of creating an affordable and quality REIT course because, when selected correctly, I see REITs as a viable option to provide stable passive income.
If you wish to find out more, click on the button below:
