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REIT Index Outperforms Broader Market in July
REITs posted their third consecutive month of positive returns in July, with the FTSE Nareit All Equity REITs Index returning its strongest monthly performance of the year, Nareit reported. The index posted a total return of 7.2%, outperforming broader markets. The Dow Jones U.S. Total Stock Market and Russell 1000 rose 1.8% and 1.5%, respectively.
The yield on the 10-Year Treasury declined 32 basis points in July to end the month at 4.05%. The dividend yield on the FTSE Nareit All Equity REITs index was 3.86% and the FTSE Nareit Mortgage REITs Index yielded 11.97%, compared to 1.27% for the S&P 500.
The All Equity REITs index is up 28.0% since Oct. 19, 2023, when the yield on the 10-Year Treasury hit 4.98%. On a year-to-date basis, the index has returned 4.8%. Since October 2023, the Dow Jones U.S. Total Stock Market is up 30.6% and the Russell 1000 is up 30.3%. Year to date, the Russell 1000 is up 15.9% and the Dow Jones U.S. Total Stock Market is up 15.7%.
“While it remains unclear when the Federal Reserve will begin to cut interest rates, most investors are beginning to expect a cut in September, as inflationary measures continue to approach the central bank’s target range,” wrote Nareit’s John Barwick.
