You can buy REIT in the stock market just like a regular stock. When you buy a REIT you are investing in real estate which is comprised of rental spaces where the tenants pay their rent on a monthly basis. You then get a portion of that payment as “dividend” based on the number of shares you bought. REIT is required by law to pay a large portion of their income to its shareholders, so it’s common to receive dividends above 5% or even 10% of the share price unlike stocks which usually pays below 5% or sometimes do not even pay. Of course there are cases when an individual stock pays a higher dividend than a REIT but that’s not very common and consistent.

Since REIT is paying out almost all of its profit to share holders, there is not much money left to spend in capitalization and growth. This is the reason why prices of REIT shares don’t normally go up as much compared to individual stocks of other companies. Companies that issued stocks to investors has the option to use their profit and reinvest it into their capital projects for growth so its share price can grow faster than REIT.

Just like stocks, REIT has risk and you can lose money from it. If the rental properties that the REIT company own is not making it’s expected profit then the dividend is affected which will then affect its share price. You can end up having a smaller dividend and if you decide to sell it when its market price is lower than when you bought it, then you lose a portion of your original investment. REIT is generally low to medium risk while individual stocks is medium to high risk investment.