Landlord Income, Without Lifting a Finger

How to invest like a lord...

Written by Jimmy Mengel
Posted October 26, 2021

Dear Outsider,

It was three in the morning when I got the phone call…

Now, anytime you get a phone call in the dead of night, you immediately panic. Something has to be very wrong: a car accident, a friend in jail, or maybe even an untimely death. This particular call thankfully had to do with none of these things.

In this case, it was simply an overflowing toilet. 

I was renting my lovely home in Baltimore, on a tree-lined street, to a friend of mine, and we had the unfortunate experience of those very trees attacking the pipes running into the house. What happens in that case is that the roots invade the sewage pipes and what you’re left with is a high-octane clogging situation. The result is city-grade excrement mixed with tree roots that smells like a Golgothan mated with a black walnut.

Sorry for that image. In any case, it meant that I had to put on some clothes and rush over to the home to start cleaning up and try my damndest to fix the problem.

Ah, the perks of being a landlord...

The calls in the middle of the night because the basement has flooded, the weekend trips to fix a backyard fence, the electrifying experience of shocking yourself while installing a ceiling fan…

All of those things happened to me when I was renting out my old house. I could go on and on, but I’ll get to the point. Despite all of the years of inconvenience of renting a property, there is one thing I do miss: plenty of extra cash coming my way.

That’s why I suggest investing in a much easier, more fruitful, and stress-free way of creating income from rental spaces. And you won’t even have to leave your house... I’m talking about real estate investment trusts

You may have heard of them referred to as “REITs.” REITs, if you are unfamiliar with them, utilize a unique company structure with massive tax advantages. An REIT is a company that owns and typically operates income-producing real estate. That means any space that produces rent and money for the owners. The real estate can be anything from office and apartment buildings to warehouses and hospitals, shopping centers, malls, hotels — you get the picture.

To qualify as an REIT, a company needs to meet these criteria: 

• Invest at least 75% of its total assets in real estate 

• Derive at least 75% of its gross income from rents from real property, interest on mortgages, financing real property, or from sales of real estate 

• Pay at least 90% of its taxable income in the form of shareholder dividends each year

• Be an entity that is taxable as a corporation 

• Be managed by a board of directors or trustees

• Have a minimum of 100 shareholders

It is a pretty simple formula and works out wonderfully for investors — especially investors who want some meaty checks coming to them every few months.

I like monthly checks without the midnight sewage cleanup, and here’s one good bet for a well-paying REIT that should do well in the good times and literally shitty times…

American Tower (NYSE: AMT) builds, maintains, and leases the towers used for America’s cellphones. It’s been mentioned by name at the Pentagon as the go-to company to install thousands of new, next-generation 5G towers that’ll keep China off of our airwaves.

This is also the company that’ll build the physical “border wall” of cell towers up and down our border...

American Tower is one of the largest global REITs, and is a leading independent owner, operator, and developer of multi-tenant communications real estate with a portfolio of approximately 181,000 communications sites.

The company erects, owns, and leases cellphone towers all over the United States and in many other countries around the world. This company is a one-stop shop. It designs, oversees production, and provides maintenance.

It’s the ONLY 5G supplier in the world to make every single part in the system — from the power converters on the ground... to the tip-top of the antenna array.

There is nowhere to go but up for this REIT. American Tower has also shown its resilience during the pandemic economy. It’s up 28% this year, with plenty of room to run.

And you’ll be able to cash quarterly dividends regardless of what kind of sewage backup the market gives you.

It’s actually the least exciting stock in my new Crow’s Nest report. That says more for the other two then it does about American Tower. They both have sky-high ceilings that could allow you to actually buy another home.

Check them out today, and I’ll also give you a free tutorial video about investing in REITs, and a half dozen others that could make you a landlord today.

Without the 3:00 a.m. calls or plungers...

Godspeed,
jimmy-mengel-signature-fixed

Jimmy Mengel

follow basic @mengeled on Twitter

Jimmy is a managing editor for Outsider Club and the investment director of several personal finance advisories, The Crow's Nest, and The Adventure Capitalist For more on Jimmy, check out his editor's page.

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