Residential Real Estate Investment Trusts

Pick a winner To pick the right residential real estate investments, REITs or other investments, investors must do their homework. Investments rise and fall with the overall stock market, so share price isn't the only factor to consider. The track record and management of a REIT should also be strongly considered. Look at the returns the investment has generated over one year, three years and five years.

I recommend:  Forbes created a scorecard of REITs by class, which gives a snapshot of every publicly-traded equity. The list is a strong reference for equities made up of residential real estate investments as well as other categories such as retail or office properties.

How to trade You can acquire residential real estate investing companies through several avenues, including investment advisers and online brokerages. Some residential real estate investing companies trade on the New York Stock Exchange. Investors purchase shares as they would with stock in any other company or fund.

I recommend:  Fidelity or E*Trade Financial offer low-cost trades with an online account. They also offer advisory services to help you make the right choice.

Invest in apartments or manufactured homes The two categories of residential investments are apartments and manufactured homes.

I recommend:  Two companies specializing in apartment investment are Mid-America Apartment Communities Inc. (NYSE:MAA), and United Mobile Homes Inc. (NYSE:UMH), a REIT which owns and operates manufactured home communities. A resource for information about manufactured homes is the Manufactured Housing Institute, which tracks the industry and publishes information on sales and housing demand.