Real Estate Investment Trusts (REITs) are becoming a popular investment choice in India, especially for those who want to earn from real estate without owning property. Think of REITs as mutual funds, but for commercial buildings.

REITs own and operate income-generating properties like office parks, malls, hotels, and warehouses. They make money by collecting rent from tenants and then distribute most of that income to investors.

What makes REITs attractive is the regular income they offer. By law, Indian REITs must distribute at least 90% of their net income. Investors receive this in the form of dividends, interest, or capital gains.

REITs are listed on the stock market, so you can buy and sell them just like shares. Right now, India has four major REITs: Embassy, Mindspace, Brookfield, and Nexus Select Trust.

On average, REITs in India provide annual returns of 7–9%. This includes rental income of 4–6% and 1–3% from capital appreciation.

They're ideal for conservative investors looking for stable, long-term returns. However, they aren't free from risks. REITs are sensitive to interest rates and offer limited growth compared to equities.

Taxation also varies-short-term gains are taxed at 20%, while long-term gains (after 12 months) are taxed at 12.5%.

Still, for those seeking predictable income and portfolio diversification, REITs can be a smart addition to your investment strategy.