Singapore REIT investors have certainly been on a bit of a rollercoaster recently. These are tumultuous times for the stock market, and it seems it has its doubts about this sector.
Think back to the end of last year—Singapore REITs were on a high, riding a wave of optimism sparked by the US Federal Reserve’s decision to cut rates. But that enthusiasm didn’t last long. When the Fed decided to halt further rate cuts, those earlier gains quickly vanished.
So, what’s causing this wild ride in the REIT sector?
Well, rather than zeroing in on the ups and downs of unit prices, my co-founder, David Kuo, suggests we take a step back and consider why owning REITs makes sense in the first place.
### Why Consider Adding REITs to Your Portfolio?
If you were to ask David why he believes in holding REITs, he might just reply with, “Why not?” Here’s a compelling reason: land isn’t something you can just create more of. The supply is fixed. Owning REITs provides access to valuable real estate, which can yield stable rental income.
By carefully selecting REITs, you can enjoy twofold benefits: a reliable stream of income and the possibility of capital appreciation as property values increase over time.
### Reason #1: Keeping the Taxman at Bay
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