This Real Estate ETF Won’t Price You Out of the Market

As real estate prices continue to surge, investors don’t need to feel priced out of the market with opportunities like the FlexShares Global Quality Real Estate Index Fund (GQRE).

The global appeal of real estate has U.S. buyers looking at Europe for property inquiries, according to a recent Wall Street Journal article.

“In mid-June, the European Union reopened nonessential travel from the U.S., prompting a jump in property inquires, says Mark Harvey, a London-based partner and head of international residential sales at the U.K.’s Knight Frank,” a Wall Street Journal article said. “He says the latest wave of house hunters are especially interested in vacation homes in Italy and France, and he also has seen more calls about Lisbon. At Savills, another U.K. real-estate company, inquiries from Americans have doubled compared with this time last year, says Hugo Thistlethwayte, head of global residential operations.”

Per the fund description, GQRE seeks investment results that correspond generally to the price and yield performance, before fees and expenses, of the Northern Trust Global Quality Real Estate Index. The index is designed to reflect the performance of a selection of companies that, in aggregate, possess greater exposure to quality, value, and momentum factors relative to the Northern Trust Global Real Estate Index.

“Investing in the real estate sector offers the potential to add growth, diversification, income along with potential protection against the risk of long-term inflation to a portfolio,” a FlexShares article said. “We believe that a well-diversified and global approach to real estate investing is a key factor in unlocking the full range of these potential benefits.”

Income without the Landlord Headaches

One of the benefits of investing in GQRE is passive income exposure through real estate investment trusts (REITs). Investors can derive income without the hassle of purchasing rental property and then becoming a landlord. Collecting rent, maintaining the property, and more are off the table.

“Global real estate may provide an alternative source of income to investors searching for yield in a low interest rate environment,” FlexShares said on its website. “Historically, our analysis suggests that dividend payments distributed by real estate investment trusts (REITs) have been attractive relative to equity dividends and fixed income coupons.”

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