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The Best ETFs to Invest in Real Estate

johnNjohnN
in Fund Discussions
The Best ETFs to Invest in Real Estate

https://money.usnews.com/investing/funds/slideshows/best-etfs-to-invest-in-real-estate

Investors are drawn to real estate investments for different reasons. For some, the investments offer big yield potential as properties generate a steady stream of income for shareholders. For others, real estate assets are a hedge against volatility.

When it comes to real estate stocks, more seem to be popping up every day. Whether you're investing in mortgage lenders or industrial park operators or various real estate investment trusts, there are many options out there to sort through.

If you're having trouble choosing which individual real estate stock to buy, or if you simply prefer the peace of mind that come with diversification, consider these real estate exchange-traded funds instead.

1. Vanguard Real Estate ETF (ticker: VNQ). A $63 billion behemoth, the VNQ fund from Vanguard is one of the most popular ways to invest in real estate via a brokerage account or retirement plan. The portfolio spans all manner of companies that own properties, ranging from health care facilities to hotels to malls.

There are about 200 component stocks that make up this real estate ETF. That's a very diversified list and at a relatively cheap fee structure at just 0.12% annually in expenses. You'll only pay about $12 per year on every $10,000 invested.

2. Schwab U.S. REIT ETF (SCHH). A slightly smaller list of real estate companies makes up the SCHH fund from Schwab, with just under 110 components in this ETF at present and about $5 billion in total assets under management. The fees are a bit smaller too, however, with an expense ratio of just 0.07% annually or $7 each year on every $10,000 you invest. The holdings are big REITs you should know, including mall operator Simon Property Group (SPG) and orange locker operator Public Storage (PSA). – Jeff Reeves

Comments

  • OpenSeSaFi
    A $63 billion behemoth, the VNQ fund from Vanguard is one of the most popular ways to invest in real estate via a brokerage account or retirement plan. The portfolio spans all manner of companies that own properties, ranging from health care facilities to hotels to malls. There are about 200 component stocks that make up this real estate ETF. That's a very diversified list and at a relatively cheap fee structure at just 0.12% annually in expenses. You'll only pay about $12 per year on every $10,000 invested.
  • rforno
    edited May 2019
    It's not listed in that article but I'm presently eyeballing the Invesco KBW Premium Yield Equity REIT ETF (KBWY). It skews small-to-midcap and the index managers seem to have views similar to mine regarding real estate based on the major moves they made from last year to this year. Not holding many of the 'usual names' in REIT-land (or in major %ages) is quite attractive to me as a contrarian.
  • johnNjohnN
    i agree, been adding to vnq lately. also own O and duke-realty - long term keepers good div/returns. these vehicles did go down tremendously during 2008 crash
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