JPM real estate strategist Michael Hudgins believes a 5% to 6% growth seems reasonable, considering the pullback during the recession and dividend cuts.
“U.S. REITs do not currently offer value versus equities, and have been trading in a range that goes from slightly expensive to slightly discounted relative to the value of their underlying portfolios,” Hudgins said in the article. “Having said that, the dividend growth described above combined with measured but improving strength in the U.S. economy and U.S. commercial real estate market (i.e., improving occupancy and rent growth) should support positive returns, even while U.S. REITs underperform the broader equity market and, perhaps, international REITs.”
- Vanguard REIT Sector ETF (NYSEArca: VNQ)
- SPDR Dow Jones REIT ETF (NYSEArca: RWR)
- First Trust S&P REIT Index Fund ETF (NYSEArca: FRI)
- Schwab U.S. REIT ETF (NYSEArca: SCHH)
Vanguard REIT Sector ETF
For more information on real estate investment trusts, visit our REITs category.
Max Chen contributed to this article.