A Targeted REIT ETF Strategy to Capitalize on Rising Rents, Shifting Demographics

In a low-growth, low-yield environment, many have turned to alternative avenues of income generation, such as real estate investment trusts. Among the various options available, investors should focus on health and residential REITs-related exchange traded funds.

“Balancing the search for income while managing risk remains a challenge for investors,” according to BlackRock. “REITs may play a role in that effort.”

BlackRock argued that residential and health care REITs are two sub-industries that could benefit income investors in the current environment.

Residential REITs, which track multifamily and manufactured homes, apartments and student housing facilities, are supported by job growth, rental demand over home purchases and general household formation.

SEE MORE: Residential REIT ETF Could Capitalize on Diminishing Sentiment Toward Home Ownership

“Demand for rental properties, particularly in growing urban areas like San Francisco and New York, is likely to continue, strengthening the case for investing in residential REITs,” BlackRock said.

Health care REITs include real estate activities that relate to health care industries, such as senior living properties, hospitals and other medical-related properties.