{"id":997,"date":"2022-07-19T23:18:15","date_gmt":"2022-07-19T23:18:15","guid":{"rendered":"https:\/\/kellyintel.com\/?p=997"},"modified":"2024-01-26T15:52:12","modified_gmt":"2024-01-26T15:52:12","slug":"barrons-6-apartment-stocks-that-get-a-rise-out-of-high-home-prices","status":"publish","type":"post","link":"https:\/\/kellyintel.com\/barrons-6-apartment-stocks-that-get-a-rise-out-of-high-home-prices\/","title":{"rendered":"Barron’s: 6 Apartment Stocks That Get a Rise Out of High Home Prices"},"content":{"rendered":"

Apartments are a critical component of the RESI Index<\/a> , and the overall housing market, as housing is undergoing a seismic change due to demands and demographics.<\/p>\n

Apartment constituents in the RESI index have unique competitive advantages of high-demand locations, industry-leading scale, and local management enhance ability to efficiently maximize the resident experience and Barron’s highlighted the current opportunity:<\/p>\n

Skyrocketing home prices and mortgage rates<\/a> make this a tough time to buy a house. But it\u2019s an opportunity for bargain hunters to invest in apartment real estate investment trusts, which have been clobbered this year and are down about 20% despite surging rents […]<\/p>\n

Apartment REITs are currently trading at a 21% discount to the value of their underlying assets, calculates Green Street, a commercial real estate analytics firm. As recently as a year ago, they were trading at a 3% discount […]<\/p>\n

It isn\u2019t surprising that apartment REITs have tumbled along with stocks and bonds this year in a broad market selloff. Real estate investments are sensitive to interest rates, which raise borrowing costs […]<\/p>\n

But high rates are actually good news for apartment REITs, since they make buying a home more difficult. After a period of record-low mortgage rates, the 30-year fixed rate has nearly doubled to 5.51%. In May, the median existing-home sales price topped $400,000 for the first time, further straining affordability.<\/p>\n

\u201cThere are some would-be buyers who are now pushed into the rentership pool,\u201d says Haendel St. Juste, managing director and REITs analyst at Mizuho Securities. \u201cThe dramatic shift in the cost of homeownership is a net benefit for the rental side.\u201d<\/p><\/blockquote>\n

The RESI Index has approximately 37% exposure to the REITs mentioned in the article:<\/p>\n