In this article, we discuss 10 best real estate ETFs to buy. If you want to skip our discussion on the real estate market, head over to 5 Best Real Estate ETFs To Buy Now.
Despite economic challenges worldwide, real estate industry leaders surveyed by PwC are hopeful for a potential uptick in investment activity, driven by further clarity on monetary policy in key regions like the United States, Europe, and the Asia Pacific. They anticipate stakeholders in property transactions to adjust to higher interest rates, facilitating agreement on pricing. While the real estate sector has faced a notable downturn, there is optimism about recovery, though it is more pronounced in 2025 than in 2024. The real estate industry has shifted its focus from short-term concerns to a longer-term outlook, with attention shifting towards “the three Ds” – demographics, digitalization, and decarbonization. This transition is reshaping real estate dynamics, with sustainability playing a central role. Factors like ESG performance and alignment with employee values are increasingly influential in companies’ real estate decisions, with offices evolving to reflect sustainability goals. Changing occupier preferences and technological advancements are transformational forces within the corporate office sector, highlighting the importance of high-quality, sustainable spaces. Embracing innovation and delivering value beyond physical space are identified as key strategies to remain competitive in an evolving market.
According to Jones Lang LaSalle Incorporated (NYSE:JLL), the belief that interest rates have reached their peak could lead to an uptick in real estate transactions and stabilization of prices, although it may take time for available capital to be fully utilized. Opportunities for growth are present in specific sectors, geographic areas, distressed assets, and portfolio adjustments. Sectors like living spaces, driven by urbanization and demographic shifts, are expected to continue performing well. The trend towards regionalization and local manufacturing is anticipated to persist in 2024, driving demand for industrial and logistics properties. Retail is also showing signs of recovery, attracting investors as supply and demand dynamics evolve. Data centers are projected to experience significant growth, propelled by advancements in artificial intelligence and changing location preferences. In 2024, occupiers of real estate will focus on solidifying workplace policies and aligning portfolios with evolving work trends. Sustainability will remain a focal point, with rising demand for environmentally friendly buildings and workspaces.
As per a recent CNBC report, the United Kingdom appears positioned to lead a revival in European real estate this year as foreign investors inject funds into the region’s challenged property market. A projected decrease in interest rates and modest economic growth are attracting overseas investors drawn to more appealing pricing levels, according to recent research from Savills. Investors from the United States, Israel, Japan, and Taiwan are expected to drive a 20% increase in real estate investment activity in 2024, focusing on the United Kingdom, Germany, Spain, and the Netherlands. Rasheed Hassan, Savills’ head of global cross-border investment, expressed confidence in the recovery, highlighting the UK’s attractive market characteristics such as its depth, accessibility, and limited domestic competition. London emerged as the top destination for cross-border investment in CBRE’s 2024 European Investor Intentions Survey, followed by cities like Paris, Madrid, Amsterdam, and Berlin. The UK is forecasted to attract a significant portion of outbound investment, with estimates suggesting around $13 billion from the United States alone. Germany, Spain, and the Netherlands are also expected to benefit from US investment. Logistics and residential properties are anticipated to be the primary beneficiaries of overseas investment in 2024, surpassing offices as preferred asset classes for investors.
Some of the best real estate stocks to buy include Public Storage (NYSE:PSA), CoStar Group, Inc. (NASDAQ:CSGP), and CubeSmart (NYSE:CUBE). However, we discuss the best real estate ETFs in this article.
Our Methodology
We curated our list of the best real estate ETFs by choosing consensus picks from multiple credible websites. We have mentioned the 5-year share price performance of each ETF as of March 29, 2024, ranking the list in ascending order of the share price performance. We have also discussed the top holdings of the ETFs to offer better insight to potential investors.
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