When it comes to diversifying an investment portfolio, real estate investment trusts (REITs) have a place in many portfolios. REITs are companies that invest in different kinds of income-producing real estate — like shopping centers, condominiums, housing developments and parking garages. Investors can buy shares in a REIT and participate in the profitability of its management and property through dividend payments. And as a bonus, most REITs must return at least 90% of their taxable income to shareholders. REITs are available as individual REIT stocks, REIT mutual funds and REIT exchange-traded funds; they also play a larger role in certain defined contribution and retirement plans.

How to start investing in ETFs way to invest in real estate without purchasing property directly, and it’s possible for anyone with a brokerage account to purchase them. But as with any investing move, it’s important to weigh your options carefully and consider your time horizon, risk tolerance, financial goals and personal circumstances before making a decision.

The Best Brokers for Trading in 2025: UK & Global Picks Compared

Select spoke with Sachin Jhangiani, Co-Founder and Chief Marketing Officer at Elevate Money, to help break down some of the basics of how to invest in REITs. He explains the different types of REITs and their underlying investments, as well as how to evaluate an individual REIT for your particular situation. For investors who don’t want to trade REIT shares on their own, Jhangiani says it can make more sense to buy an ETF or mutual fund that already contains vetted REITs. This approach can lower your risks and offer immediate diversification, and it’s a lot easier to get started.