10 Reasons REITs Beat Buying a Rental Apartment (for Diversified Investors) 

Many Kenyan investors love the tangibility of an apartment, which is okay, but hear us out: A single unit concentrates risk in one location, one tenant profile and one asset. REITs spread that risk across hundreds of properties, often spanning multiple areas and sectors—and they’re built for passive investors. 

1) Real diversification you can’t get with one Apartment 

A rental apartment = one bet. A REIT = a portfolio of properties (e.g., residential, retail, industrial, healthcare). That reduces idiosyncratic risk (vacancies, repairs, local shocks) and smooths returns over time. 

Bottom line: If diversification is your goal, REITs do it by design. 

2) Far better liquidity 

Selling an apartment can take weeks to months and involves marketing, viewings, and legal processes. Most listed REITs trade on an exchange, so you can enter or exit in minutes at market prices. 

Why it helps: You can rebalance your portfolio quickly (e.g., during market volatility or when a new opportunity appears). 

3) Lower minimums & easier scaling 

Buying a rental requires a big down payment, taxes, and closing costs. With REITs, you can start with small ticket sizes, then cost-average monthly. That makes it easier to scale exposure without taking on outsized leverage. 

Pro tip: Automate monthly contributions to smooth price volatility over time. 

4) Professional management  

REITs employ property and asset managers to handle tenant sourcing, leasing, maintenance, compliance, and capital allocation. You capture the benefits of institutional management without becoming a landlord. 

Saved time = real ROI: No tenant calls, no contractor wrangling, no annual service charge negotiations. 

5) Passive income with fewer surprises 

Apartments can produce cash flow, but also lumpy expenses (vacancies, repairs, service charge hikes). REITs aim to distribute regular income from diversified rental streams, smoothing cash flow across many leases and tenants. 

Note: Distribution frequency varies (monthly, quarterly, semiannual), but it’s typically more predictable than a single-unit cash flow. 

6) Transparent pricing & portfolio visibility 

Apartment valuations depend on appraisals and comparable sales. REIT units have real-time market prices and publish audited reports on occupancy, rental yields, debt, and pipeline. 

Investor benefit: You can track performance and risks more easily and respond faster. 

7) Potential tax efficiency (jurisdiction-dependent) 

Many jurisdictions offer pass-through treatment for REIT income or avoid double taxation at the trust level, provided payout requirements are met. While tax rules vary, REIT structures are often built to be investor-friendly. 

In the case of Investors within Vuka Investing in the Acorn REITs, capital gains are tax exempt while dividends are taxed at 5% WTH at source. 

8) Smarter risk management & debt discipline 

Individual buyers often carry concentrated mortgage risk tied to one unit. REITs typically manage portfolio-level leverage with staggered maturities, fixed/floating mixes, and hedging policies. 

Why it matters: Sensible gearing across a large portfolio can be safer than a single, highly leveraged unit. 

9) Over 10,000 Kenyans have already joined 

You’re not alone on this journey. Over 10,000 Kenyans have already diversified their investments with Vuka. By joining them, you’re among the savvy investors who have every reason to believe in this opportunity. 

10) Lower frictional costs over the long run 

Apartment investing includes stamp duty/transfer taxes, legal fees, agency commissions, furnishing, repairs, and potential vacancy gaps. REITs have ongoing expense ratios, but they avoid many one-off costs and can benefit from institutional economies of scale. 

Net effect: Less drag on your returns, especially if you rebalance or add capital frequently. 

REITs vs. Rental Apartment: At-a-glance 

When a rental apartment might still make sense: 

• You want full control and are comfortable with active management. 
• You have unique information about a micromarket (e.g., you can buy below market or add value). 
• You’re targeting development/repositioning returns (higher effort, higher risk). 

Even then, many investors hold both—a REIT core and a selective direct property allocation. 

Ready to diversify your real estate exposure without becoming a landlord? Consider building a core REIT portfolio that is balanced by sector and region, then add tactical tilts as opportunities arise.