Real Estate Economics 156 Foldvary

Problem Set 8 - REITs

40 pts, 4 pts. each. Due Wednesday, May 28.

Go to the web site:

http://www.cohenandsteers.com/

Briefly answer these questions:

1. ) What is a REIT?

2.) What is the advantage of having REITs in a portfolio of investments?

3) What is the long-run (past 10-year) return on REITS compared to stocks?

4) What is the tax status of REITs?

5) What is the difference between a real estate mutual fund and a REIT?

6) What is the difference between a REIT and a limited real estate partnership?

Go to the web site:

http://www.nareit.com/

7) What is NAREIT?

8) What "NAREIT indexes"? (What is it that they index?)

How can an investor use the indexes?

Go to the web site

http://www.bostoncapital.com/index.jsp

9) Describe "tax credit" funds. What advantage do they have for investors?

10) Go to http://www.vanguard.com and look up the Vanguard REIT index fund

(VGSIX). What is the advantage of owning shares in such a real estate index fund?