Real Estate Investment Trusts have some standout benefits that make them a favored investment vehicle when it comes to the real estate industry. When you decide to take a stake in a REIT you get to benefit from investing in a diversified portfolio of properties as opposed to one property at a time. Our portfolio contains Single Family Rental Properties covering numerous states in the US. It is important to note that in this endeavor our mission statement charts out how we conduct our business in a bid to ensure all our clients hold a well diversified asset.
Under our corporate mission, investors will find that we operate by acquiring and restoring single family homes, getting them leased out and subsequently managing the lease to guarantee risk adjusted returns in the long term.
Below we will take a look into how this operational strategy is implemented in the markets we operate in to ensure clients get a diversified asset straight from the jump.
Why Single-family Rentals?
The previously witnessed credit crisis a few years ago led to numerous home foreclosures, while the rising home prices have further made it more difficult for potential home owners to buy new homes. This means that the rental market in the US is booming especially for people who lost their homes as well as those who are looking for new homes. This is where single family rentals are gaining a lot of demand.
Diversified Property Acquisition
Our business buys batches of homes in states and cities where the population is continuously growing; this is in a bid to capture the growing rental market. For instance, the City of Phoenix is a great example of this phenomenon. The city has witnessed tremendous growth in home prices locking families and potential home owners out; the next best solution becomes renting. However, it is important to note that even in such an appealing market we do not go in blind and over extend ourselves potentially opening ourselves up for failure.
As a REIT it is important to note that buying numerous single houses can be costly especially since the maintenance and administrative needs are spread out. We have seen other REITs buy up numerous houses without paying attention to the administrative bottlenecks this comes with as well as the associated lack of diversification this demonstrates. To maintain our 8% annual dividend and diversify our portfolio even within a single city, we buy up smaller batches of homes in different locations in a bid to minimize maintenance costs as well as ensure vacancies are filled easily.
Our operational strategy involves buying houses not just because they are vacant but for the most value to investors. To guarantee a long term risk adjusted return to investors, we believe in keeping all acquisitions well diversified. Our mission statement is a guiding pillar in outlining how we achieve a diversified portfolio. We implement a disciplined acquisition criteria meant to make sure we only acquire properties that work to diversify and strengthen our position by presenting the most value to different tenants in different properties.
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