Want to make a passive income? This property stock will do just that! – Motley Fool UK

December 15, 2021 by No Comments

I want my holdings to make me a passive income, so I am on the lookout for dividend stocks. One pick that can help me do that is PRS The REIT (LSE:PRSR).

Passive income seekers heaven

Investors often look at buy to let opportunities to access the property market. A real estate investment trust (REIT) is a company that owns and operates income-producing real estate. One of the main rules a REIT must follow is that 90% of its tax-exempt property income profit must be distributed to investors as dividends.

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PRS is the UK’s first quoted REIT to focus on newly built family homes for the private rental market. It aims to enhance the rental experience for consumers and provide them with new, quality homes. As I write, PRS shares are trading for 106p, whereas a year ago shares were trading for 75p. This is a 41% return over a 12-month period.

Why I like PRS

I like PRS first because the current housing and house building market is booming. The demand for new houses is outstripping supply and housebuilders are working as hard as possible to build them. Buyers are on the lookout for new homes to buy and live in, but due to rising costs, most turn to renting. PRS can benefit from both of these favourable market conditions. It builds its own houses and then manages renting them to consumers.

I like the idea of building up a buy to let portfolio as an investment vehicle but this can be costly and time consuming. A REIT like PRS can help me make a passive income without thousands of pounds of outlay and time …….

Source: https://www.fool.co.uk/2021/12/15/want-to-make-a-passive-income-this-property-stock-will-do-just-that/

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