Earn $8/Day in Passive Income With These 2 REITs

Dividend investors who want to create a passive income stream might want to consider adding these two top REITs to their portfolios.

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Investing in real estate to generate passive income can be an excellent way to boost your monthly revenues through rental income. However, purchasing investment properties requires a significant upfront cash outlay. Investing in real estate investment trusts (REITs), however, can provide you with the opportunity to earn monthly returns without the massive cash outlay.

High-quality REITs offer monthly distributions like some dividend stocks, trading on the stock market. REITs are generally defensive assets to hold, making them ideal for passive income-seeking investors.

If you are a Canadian investor looking to increase your passive income through some of the top REITs, here are two top REITs you can consider.

Granite REIT

Granite REIT (TSX:GRT.UN) is a trust that invests in a portfolio of industrial real estate assets. The REIT has grown rapidly for several years, benefitting from the rising demand for warehouse space amid the e-commerce industry’s boom. The REIT boasts a high-quality tenant base and an impressive 99% occupancy rate that ensures significant revenues for the trust.

At writing, Granite REIT trades for $99.13 per share, and it boasts a 3.09% dividend yield. The fund also boasts a 10-year dividend growth streak. Investing $37,000 in Granite REIT would provide you with $1,143.3 per year through its monthly distributions, translating to $3.13 per day.

CT REIT

CT REIT (TSX:CRT.UN) is a trust you could consider if you value dividend growth as a part of your investment strategy. It is another Canadian Dividend Aristocrat that boasts an attractive dividend yield and a solid track record for raising its distributions each year. CT REIT is a retail-focused trust that is primarily owned by Canadian Tire. The trust receives 90% of its income from Canadian Tire and its subsidiaries, making it a strong income-generating asset to consider.

At writing, CT REIT trades for $17.06 per share, and it boasts a 4.96% dividend yield. Investing $36,000 in CT REIT would provide you with $1,785.6 per year through its monthly distributions, translating to $4.89 per day.

Foolish takeaway

Investing in REITs to generate a significant passive income does require investing a decent amount of money, but it is nowhere near how much you would need to acquire investment properties. Additionally, you can earn income like a lazy landlord through REITs because you would not have to worry about the hassle and expenses that come with managing properties.

If you invest $37,000 in Granite REIT and $36,000 in CT REIT, you can earn $8.02 per day through monthly distributions alone. However, this is a hypothetical scenario. I would not recommend investing such a substantial amount in just two securities. Consider diversifying your investment capital across several reliable income-generating assets that offer similar dividend yields to generate safer returns.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium service or advisor. We’re Motley! Questioning an investing thesis — even one of our own — helps us all think critically about investing and make decisions that help us become smarter, happier, and richer, so we sometimes publish articles that may not be in line with recommendations, rankings or other content.

Fool contributor Adam Othman has no position in any of the stocks mentioned. The Motley Fool recommends GRANITE REAL ESTATE INVESTMENT TRUST.

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