Australian REIT Income Fund Dividend Yield Insights (2024)

FAQs

Australian REIT Income Fund Dividend Yield Insights? ›

Australian REIT Income Fund Dividend Yield: 8.35% for June 19, 2024.

Best REITs for high dividends and growth

A current dividend of between 2 and 6 percent. A dividend growing at least 5 percent annually over the last five years. A positive total return over the last five years.

The Securities and Exchange Commission (SEC) has set out the guidelines for the 90% rule for REITs: “To qualify as a REIT, a company must have the bulk of its assets and income connected to real estate investment and must distribute at least 90% of its taxable income to shareholders annually in the form of dividends.”

REITs and Tax

Even in super, there's a cost – potentially more so than outside super. A REIT will pay substantial dividends, which are taxed at 15%, and this will be at the cost of reduced capital growth, which could have made use of the 33% long term capital gains discount.

Reinvesting REIT dividends can help retirement savers grow their portfolio's investment, and historically steady REIT dividend income can help retirees meet their living expenses. REIT dividends historically have provided: Wealth Accumulation. Reliable Income Returns.

Cons of REITs

Interest rates: Rising interest rates generally have a negative effect on a REIT's performance, because it drives up their cost of capital. Overall investor demand may also reduce at such times because higher rates make fixed-income investments more attractive.

Australian REIT Income Fund Dividend Yield: 8.35% for June 7, 2024.

But Australia does have a treaty with the United States, and Table 1 shows a lower treaty rate of 15 percent. You earned $4,000 of dividend income in Australia, and since the applicable treaty rate is 15 percent, your legal liability for foreign tax on that income is $600 ($4,000 X 15%).

What is the 5 50 rule for REITs? ›

A REIT will be closely held if more than 50 percent of the value of its outstanding stock is owned directly or indirectly by or for five or fewer individuals at any point during the last half of the taxable year, (this is commonly referred to as the 5/50 test).

Direct real estate offers more tax breaks than REIT investments, and gives investors more control over decision making. Many REITs are publicly traded on exchanges, so they're easier to buy and sell than traditional real estate.

Yields from 2% to 6% are generally considered to be a good dividend yield, but there are plenty of factors to consider when deciding if a stock's yield makes it a good investment. Your own investment goals should also play a big role in deciding what a good dividend yield is for you.

Real estate investment trusts (REITs) are required to pay out at least 90% of income as shareholder dividends. Book value ratios are useless for REITs. Instead, calculations such as net asset value are better metrics. Top-down and bottom-up analyses should be used for REITs.

Dividend yield is a percentage figure calculated by dividing the total annual dividend payments, per share, by the current share price of the stock. From 2% to 6% is considered a good dividend yield, but a number of factors can influence whether a higher or lower payout suggests a stock is a good investment.