And what are the returns you earn for all this risk? Naturally it varies from property to property. Individual landlords can do very well, especially if they are able to buy properties cheap and fix them up themselves. Nonetheless the NMHC, using data from the National Council of Real Estate Fiduciaries, estimates that from 1987 to 2016 private landlords earned average returns of up to 9.6% a year for apartments, and 8.7% overall.
The returns from publicly traded REITs over the same period? Try…10.3% a year, according to the FTSE Nareit All-Reits Index.
Don’t do it for cash flow. Do it for appreciation.