6 Housing Stocks With Curbside Appeal
The appeal of REITs isn't just their share-price appreciation potential, but their high dividends, which make them attractive for yield hounds. For example, apartment REIT Essex Property Trust(ESS) is up 12% this year and 40% over the past three years, on average, and currently yields 2.82%. The S&P 500 is up 9.6% this year.
Standard & Poor's says the "fundamental outlook for the residential REITs sub-industry is positive. We believe a lower homeowner rate, despite government incentives and modest new supply (new construction), are both working in favor of multi-family operators."
S&P Capital IQ says that as the home-ownership rate ticks lower, "many Americans may be reluctant to purchase a home until price stability returns. As the economic recovery gains steam, we expect an increase in new household formations."
And it adds that new supply is at multi-year lows.