Smart Investor Malaysia


5 Reasons Why You Should Invest In REITs


Real Estate Investment Trusts (REITs) can be simply put as shares of commercial properties that are listed in Bursa Malaysia stock exchange.

REITs are being managed by property developers or professionals. There are many categories for REITs that will convert into a great profitable investment such as malls, residentials, factories, offices and many more.

You may want to read this : Best Reits In Malaysia. Which One Is Better? Is It Time To Invest Now?

Simply put, we can say that an amount of monies being pooled together from many other investors to invest in properties. This may be a good alternative rather than you have to buy physical properties which can cost you a fortune.

Investors who buy REITs’s shares entitled for dividend payments which will be distributed quarterly or semi annually. This is mostly contributed by the rental performance of the properties.

5 Advantages of REITs Investment

1. Invest in REITs With As Low As RM100

Whattt?? You don’t want to risk a lot of your money to your property investment?

No worries! By REITs investment, you don’t need a huge capital to start. With RM100, everyone give it a go in property investment via REITs.

Property investment using REITs in stock market
Source : Bursa Malaysia

As from the list above, you can see the price per one unit of REITs shares which most of them are below RM1.00. You will need to buy at least one lot which equals to 100 units as fixed by Bursa Malaysia.

Still, it’s way much cheaper than buying a physical property for investment.

2. Tax Exemption

REITs tax exemption

You don’t have to worry about tax. REITs investment in Malaysia are exempted from tax. If you own a physical property, you will have to pay for taxes, stamp duties and many more during your purchases or disposal.

You don’t have to pay for Real Properties Gains Tax (RPGT) which will affect your investment returns.

These taxes exemption are a huge savings where you can save a significant amount of money.

3. REITs Investment Is Easy

Don’t get yourself into property investment messes. REITs provides you peace of mind while investing.

REITs are traded on the Bursa Malaysia stock exchange. You’re not tied to a huge amount of mortgage. REITs are very liquid as they can be bought and sold easily.

You can have your CDS account, the transaction can be done via your platform. Easy, right?

4. REITs Being Managed By Professionals

reits managed by professionals

Newbies in stock market? Worry no more with REITs investment. Why? Did you know that your REITs investment are managed by professionals?

Yeah. You heard it right! Managed by professionals unlike investing in physical or conventional property. You don’t have to deal with tenants, local authorities or many other things out there.

Sit back, relax and enjoy your dividend! (Still, you need to study stocks potentials before deciding to invest)

5. Higher Dividend Payouts

Did you know that REITs will distribute at least 90% of their earnings to investors in order for them to qualify for tax reliefs?

The investors may enjoy 5% to 7% of dividends every 3 months or twice a year depending on the company.

Well, we can say that the dividends rate is higher that most of the rental properties return.

In a recent survey of Malaysians carried out by Palindrome Communications, 14 percent of respondents said they thought that REITs were good investments and 29 percent thought they weren’t. The majority of respondents (57 percent) were unsure and opted to ‘sit on the fence’. This could signify a lack of education regarding REITs in Malaysia and mean that members of the public are more familiar with other investment options. Respondents included professionals in technical fields such as engineering, and solar.

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