Find REITs and real estate stock picks across residential, commercial, industrial, and specialty property. Income picks and growth plays for investors.
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Real estate equity exposure comes in two forms. REITs deliver tax-advantaged dividend income with mandatory 90% payouts. Real estate operating companies (REOCs), homebuilders, and brokers offer growth and cyclicality. Self-directed investors who blend both can capture income and appreciation across the property cycle. Most REITs yield between 3% and 8%, with monthly REITs and mortgage REITs reaching higher.
REITs have become a structural part of most retirement portfolios because of their reliable income and low correlation with broader equities.
REITs (real estate investment trusts) are publicly traded companies that own, operate, or finance income-producing real estate. To qualify as a REIT, a company must distribute at least 90% of taxable income to shareholders as dividends. This produces meaningfully higher dividend yields than typical stocks.
REITs come in two main types. Equity REITs own physical real estate and earn rent. Mortgage REITs (mREITs) hold mortgages and mortgage-backed securities, earning the spread between funding costs and asset yields. Real estate operating companies (REOCs) like brokerages and homebuilders operate in real estate but are not structured as REITs and do not have the 90% payout requirement.
There are six main entry points.
Equity REITs are the largest REIT category. Realty Income (O, monthly dividend), Prologis (PLD, industrial), American Tower (AMT, cell towers), Equinix (EQIX, data centers), and Public Storage (PSA, self-storage) lead in their respective property types.
Mortgage REITs (mREITs) offer higher yields with higher rate sensitivity. AGNC Investment (AGNC), Annaly Capital Management (NLY), Starwood Property Trust (STWD), and Blackstone Mortgage Trust (BXMT) are the largest US-listed mREITs.
Specialty REITs target specific property types with structural tailwinds. Data center REITs (Equinix EQIX, Digital Realty DLR) benefit from AI capex. Cell tower REITs (American Tower AMT, Crown Castle CCI) benefit from 5G and wireless data growth. Healthcare REITs (Welltower WELL, Ventas VTR, Healthpeak DOC) benefit from aging demographics.
Monthly dividend REITs appeal to income-focused investors who want monthly cash flow. Realty Income (O) is the most prominent, with 670+ consecutive monthly dividends. STAG Industrial (STAG), AGNC Investment (AGNC), and Pembina Pipeline (PBA) are also popular.
Homebuilders and real estate operating companies offer cyclical exposure. D.R. Horton (DHI), Lennar (LEN), and PulteGroup (PHM) are the largest US homebuilders. CBRE Group (CBRE) is the largest commercial real estate broker.
REIT ETFs include the Vanguard Real Estate ETF (VNQ, the largest REIT ETF), the iShares US Real Estate ETF (IYR), the Schwab US REIT ETF (SCHH), and various sub-sector REIT ETFs.
Interest rates drive REIT prices. Rising rates increase REIT financing costs and reduce relative dividend appeal versus Treasuries. Falling rates do the opposite.
Property type matters more than aggregate REIT exposure. Industrial REITs and data center REITs have meaningfully outperformed retail and office REITs over the past five years.
Distribution sustainability matters. The 90% payout rule means REITs distribute most cash flow. Watching FFO (funds from operations) coverage of dividends is essential.
Tax treatment is different. REIT dividends are generally taxed as ordinary income rather than qualified dividend rates. This affects after-tax returns, especially for high-tax-bracket investors.
Equity REITs by Property Type:
Mortgage REITs: AGNC, NLY, STWD, BXMT, RC, ARR.
Homebuilders: DHI, LEN, PHM, NVR, KBH, MTH.
REIT ETFs: VNQ, IYR, SCHH, XLRE, RWR.
REIT performance is closely tied to interest rate cycles. Falling Treasury yields and Federal Reserve rate cuts typically support REIT prices through both lower mortgage costs and stronger relative dividend appeal. Rising rates do the opposite. Within REITs, recoveries tend to be uneven, with industrial, data center, and self-storage REITs often leading, while office and some retail REITs face structural pressure.
Data center REITs are among the highest-growth segments, benefiting from AI capex and hyperscaler demand. Equinix and Digital Realty are typically among the strongest performers in this sub-segment.
Healthcare REITs benefit from demographic tailwinds. Aging populations drive demand for senior housing, medical office, and life science research space.
Office REITs face structural pressure from hybrid work patterns. Some Class A office REITs have stabilized, while Class B and C office property values continue to face headwinds.
What are the best REITs to buy?
The most-held US REITs among institutional investors include Realty Income, Prologis, American Tower, Equinix, Welltower, and Public Storage. The right pick depends on yield priority (Realty Income, AGNC), growth priority (Prologis, Equinix), or thematic priority (American Tower for 5G, Equinix for data centers). For diversified exposure, the Vanguard Real Estate ETF (VNQ) is the largest REIT ETF.
What is a monthly dividend REIT?
Monthly dividend REITs distribute dividends every month rather than the quarterly frequency typical for most US stocks. The most popular monthly dividend REITs include Realty Income (O), STAG Industrial (STAG), and AGNC Investment (AGNC). Realty Income has paid 670+ consecutive monthly dividends and is sometimes called "The Monthly Dividend Company."
What is a mortgage REIT?
A mortgage REIT (mREIT) is a REIT that holds mortgages and mortgage-backed securities rather than physical real estate. They earn the spread between funding costs and asset yields. Mortgage REITs typically pay higher dividend yields than equity REITs but carry more interest-rate risk and credit risk. The largest US-listed mortgage REITs are AGNC Investment and Annaly Capital Management.
What are data center REITs?
Data center REITs own and operate data center facilities that house the servers and infrastructure for cloud, internet, and AI workloads. The two largest US-listed data center REITs are Equinix (EQIX) and Digital Realty (DLR). Both have benefited substantially from AI infrastructure capex.
What is the best REIT ETF?
The Vanguard Real Estate ETF (VNQ) is the largest REIT-focused ETF, with strong diversification across property types and low fees. The Schwab US REIT ETF (SCHH) is similar with slightly lower expense ratio. The iShares US Real Estate ETF (IYR) and SPDR Real Estate Select Sector ETF (XLRE) are also widely held.
REITs and real estate stocks combine reliable income with property-type diversification. Coverage tracks rates, occupancy trends, dividend coverage, and the catalysts moving each sub-sector. Built for self-directed US investors who treat real estate as an asset class, not just a sector bet. For specific picks, see our Best REITs guide and Best Monthly Dividend REITs list.