The Globe and Mail reports in its Thursday edition that investors looking to buy rental properties for investment income may find themselves priced out of the market in Canada's major cities because of a combination of low lending rates and a steady influx of foreign buyers. The Globe's Ian Tam writes that he focused on real estate investment trusts as a viable liquid alternative to the traditional bricks-and-mortar investment. He looked for REITs that show the best combination of dividend yield and funds from operations (FFO), which adds back the depreciation and amortization charges to a REIT's operating earnings per share. The higher the FFO is, the more income a REIT is ultimately able to generate for its unitholders through dividends. Mr. Tam also looked for REITs with cash flow estimates revised upward versus downward over the past 90 days. A positive figure is preferable. To qualify, REITs needed to have a debt-to-equity ratio of less than 1.5 and a dividend payout ratio on trailing cash flow less than 80 per cent. Mr. Tam recommends buying Pure Industrial REIT, Killam Apartment REIT, Agellan Commercial REIT and Allied Properties REIT.