Is real estate investment haram?

Many people, including many Muslims, associate the word Halal with food. However, as time goes by, more and more Muslims are asking themselves whether their investments are Halal.

Is real estate investment haram?

Many people, including many Muslims, associate the word Halal with food. However, as time goes by, more and more Muslims are asking themselves whether their investments are Halal. This is also the case when considering real estate investment. A Halal real estate investment is one that does not condone any Haram activity or trade.

Finally, through halal real estate investments, investors are offered the opportunity to earn investment income in a halal manner. In addition, it also allows investors to be part of real estate projects that can benefit the community and the wider economy (for example, by investing in the Shariah-compliant real estate crowdfunding platform Ethis Crowd). The real estate sector has an unprecedented reach internationally, and the continued growth of the halal real estate sector is a testament to the success of halal real estate investments thus far. REITs (Real Estate Investment Trusts) pool money from many investors to invest in real estate.

Yes, if you trade daily with files it may be haram, if you buy land from the qabza group it may be haram, otherwise investment in proper and clean land is not haram, Allah knows best. Most Islamic religious teachers hold that using a standard mortgage to purchase property is Halal, therefore acceptable. This is because the interest paid to the mortgage lender is strictly against the teaching of Islam and is Riba. Shariah permits investment in shares of companies (ordinary shares) as long as they do not engage in prohibited activities.

To the extent that one can find an Equity REIT that does not rely on interest to operate, my comfort level in investing would increase, as there is nothing inherently wrong with making money from leasing or trading property. All other things seem to be going smoothly in this country, the only thing left to worry about is whether property investment is Haram or Halal. As Muslims become more religiously inclined, it is their responsibility to strictly ensure that their investments are only Shariah compliant. Therefore, the case of property mortgages is exactly the same as the case of renting non-consumable items.

REITs offer investors a way to invest in a portfolio of properties without having to buy them outright. A lot of time must be invested in examining each company's shares for Shariah compliance and ongoing monitoring to ensure that the company remains compliant. Commit to improving your knowledge of Halal investing and start building a diversified portfolio that is Shariah compliant and right for you. Through these efforts by Shariah scholars, you will also ensure that investments are not involved in any activity that could cause potential harm to investors.

In the case of commercial real estate, it cannot be leased to any tenant who is engaged in a non-compliant business activity. To ensure that halal real estate investments strictly conform to Shariah standards, it is the duty of designated Shariah scholars to practice due diligence at all times and, more importantly, to ensure that all activities are within the scope of Shariah. For example, by investing in the Shariah-compliant real estate crowdfunding platform Ethis Crowd, investors will make money while creating positive, social impacts. Pensioners who want their investments to comply with Islamic principles face a dilemma, as fixed income investments include riba, which is prohibited.

For example, they must ensure that the portfolio excludes property that is acquired to facilitate activities such as gambling, etc.