What Should You Pay for Financial Services? 9 Answers

What they cost: 6 to 7% in total transaction costs.
Why: Add up all the costs of buying a piece of real estate — brokers, attorneys, paperwork — and the total can reach 6 to 7% of the property's value. Of course, almost everything is negotiable, including broker fees. Also, rather than buy real estate themselves, investors can buy funds that buy real estate. Mutual funds that specialize in real estate investment trusts (REITs) have expense ratios that vary from less than 0.5% for index funds to as much as 3% for the priciest actively managed options. The median real estate fund costs 1.03%. Beware of private, non-traded REITs, which often impose extra fees on individual investors.