Which of the following characteristics do non-traded real estate investment trusts (REITs) and exchange-traded REITs have in common?

While exchange-traded REITs are registered with the Securities and Exchange Commission (SEC) and must comply with strict regulatory requirements, non-traded REITs also register but often operate under different regulations. This means that while registration applies, the nature of the regulatory framework varies significantly between the two types, thus not being a shared characteristic.

Exchange-traded REITs are known for their high liquidity because they are traded on stock exchanges, allowing investors to buy and sell shares easily. In contrast, non-traded REITs typically have lower liquidity, as they are not traded on public exchanges, often requiring a longer commitment and having restrictions on selling shares. Therefore, liquidity is not a common feature.

Neither type of REIT provides tax-free income to investors. While REITs can distribute dividends that may be taxed at a lower rate, the income received from both non-traded and exchange-traded REITs is subject to taxation. Thus, this characteristic does not apply to either investment type.