4 Real Estate Funds For A Stable Portfolio
Zacks Investment Research | Jun 20, 2019 11:26PM ET
Per the latest report, U.S. building permits for the month of May surpassed its previous month figures to point toward strength in the housing space. Lately, there has been widespread speculation regarding a slowdown in the space. However, taking a closer look at the current scenario, the housing industry is actually reeling under extreme paucity of skilled labor amid rising prices of materials.
But such factors are only momentary impediments. Furthermore, a hiring boom in construction is another positive sign for the sector. Under such circumstances, investing in real estate mutual funds seems prudent.
Building Permits Remain Robust
Per the latest joint report by U.S. Census Bureau and the U.S. Department of Housing and Urban Development on Jun 18, building permits for the month of May rose to approximately 1.3 million units. This is slightly better than April’s 1,290,000 units.
Privately owned authorizations rose to 1,294,000 in the month. Meanwhile, single-family building authorizations rose to 815,000, higher than 786,000 in the previous month. Moreover, authorizations for buildings having five or more units came in at 442,000 units. Such healthy numbers, the analysts believe, point to robust growth for the housing sector in the days to come.
Investor Dry Powder to Boost U.S. Real Estate
A lot of proptech startups aiming to tap the real estate market have been established lately. Such startups assist real estate companies by improving the transaction process, easing the hassles involved with construction and providing newer methods of financing real estate projects. The crowdfunding legislations in 2012 and 2015 provided the required stimulus for the growth of these startups.
Talking about real estate funding, venture capitalist and private equity investors had poured in about $5.2 billion in real estate startups by the end of 2018. Moreover, angel investors are interested now, more than ever, to tap the space by investing liquid cash in real estate startups. As a matter of fact, approximately $226 billion is expected to be invested in real estate in 2019.
4 Best Fund Picks
Given such circumstances, we have highlighted four real estate mutual funds that are poised to gain from such factors. These funds also carry a Zacks Mutual Fund Rank #1 (Strong Buy) or #2 (Buy). Moreover, these funds have encouraging three and five-year returns. Additionally, the minimum initial investment is within $5000.
We expect these funds to outperform their peers in the future. Remember, the goal of the Zacks Mutual Fund Rank is to guide investors to identify potential winners and losers. Unlike most of the fund-rating systems, the Zacks Mutual Fund Rank is not just focused on past performance, but also on the likely future success of the fund.
The question here is: why should investors consider mutual funds? Reduced transaction costs and diversification of portfolio without several commission charges that are associated with stock purchases are primarily why one should be parking money in mutual funds (read more: Zacks Investment Research
Get The News You Want
Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.