In this article, My Reality India, pointed out the pros and cons of rel estate investment options
Direct investment:
Pros
* Specific cash flows from rental income
* Can target specific property types
* Investment in the form of physical assets
Cons
* High transaction costs
* Asset specific risk is more
* Need for a property maintaining manager
* Not easily liquidity - takes more time to sell or buy
Listed Real Estate Shares
Pros
* Easier to diversify portfolio. In India there are more than 12 listed real estate shares available for investment
* Any time - Daily liquidity and pricing (Market Time- 9.15 a.m -3.30 p.m, Monday to Friday)
• Transparency of reporting and pricing
• Attractive dividend yields
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Cons
* Moves more in line with short-term movements in broad equity markets
* There is no guarantee of return
REIT Preferred Stock
Pros
* Higher dividend yields than real estate shares
* Has a priority claim on cash flow
* Listed on major exchanges.
Cons
• Can offer lower total returns than real estate shares
• Not easily liquidity
