Dec 31, 2010
If you’re invested in REITS (Real Estate Investment Trusts) then you’re the winner. Not only are you receiving big dividends but real estate stocks have once again trumped the broader stock market with gains of 27% versus the Dow’s 11%.
This stellar performance of REITS is being attributed to investors seeking bigger dividends; REITS are currently paying dividends of around 4% compared to 3.35% on treasury bonds.
“The REIT yields are very attractive compared to anything else in the market,” said Brad Case, vice president of research and industry information for the National Association of Real Estate Investment Trusts.
Other investors are buying REITS based on the belief that the economy is recovering and commercial landlords will be posting stronger earnings from rising rents and occupancy in 2011.
Whatever the reason, REITS were a great investment tool in 2010. Average gains of 27% plus dividends of 4% equals a return on investment of 31% – that’s a pretty sweet deal.