Yes, there is an initial dip from REITs when inflation spikes and the Fed raises rates. Hoever, REITs have historically been able to overcome that dip quite easily. That’s because top-notch property owners have long been able to raise their rents at faster rates. And thanks to their tax requirements, much of those high rents make their way back to investors pockets as dividends. With a faster pace of dividend increases, REITs have managed to outperform the S&P 500 the majority of the time during rising rate/high inflation environments. The reality is, REITs are a great investment in today’s market conditions. The key is to bet on the top-notch REITs that have the ability to really raise rents. Here are five such REITs to buy today...
The key for REITs and their ability to beat inflation comes down to the old adage “location, location, location.” The better and more in-demand your properties are, the easier it is to drive up rents. And that’s just what Douglas Emmett (NYSE:DEI) has been able to do. Shopping is getting a big makeover these days as online and omnichannel become the norm. And that means big things for REITs like Prologis (NYSE:PLD). Once again, it all comes down to location, and Kimco Realty (NYSE:KIM) has the ideal locations in spades. There are plenty of places where it’s simply too expensive for the average joe to afford a home. Equity Residential (NYSE:EQR) has tapped into this fact in a big way. You certainly could buy all the picks on this list … or you could get them all in one ticker. That’s where the iShares Cohen & Steers REIT ETF (BATS:ICF) comes in.
Source: InvestorPlace
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