Keepin' It Real 

Economics, Housing, & Commercial Real Estate Analysis

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  • Alex Pettee, CFA

REITs And Housing Sector Climb To Record Highs

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  • After snapping a four-week losing streak in the prior week, US equity markets gained for the second straight week as solid employment data eased concerns of a more serious slowdown.

  • Perhaps the best evidence that the US economy is in better shape than the prevailing narrative suggests, the US housing index climbed to another new record high this week.

  • Party like it’s 2016. Surging 25% so far this year, the largest real estate ETF, VNQ, finally clawed its way to a new record high, surpassing its 2016 peak.

  • Nonfarm payrolls rose 130k in August, below consensus estimates of 160k. Job creation has slowed following a mid-cycle reacceleration in 2018, weighed down by particularly weak retail hiring.

  • Aside from a miss on the headline figure, however, employment data was actually quite solid. Two of the three major employment surveys - Household data and ADP - were significantly better than expected.

Following a nearly 3% in the prior week, the S&P 500 (SPY) climbed nearly 2% this past week while the Nasdaq (QQQ) ended higher by 2.2%. REIT investors continue to party like it's 2016 as the broad-based REIT ETF (VNQ) gained another 1.3% on the week, finally clawing its way to a new record high, surpassing its prior 2016 highs.

The economic calendar this coming week is highlighted by JOLTs, inflation, and retail sales data. On Tuesday, we get a look at July's Job Openings and Labor Turnover Survey. For most of the past two years, the number of job openings has outpaced the total number of unemployed Americans seeking work by at least one million. On Wednesday, we get a look at PPI data, while on Thursday, we'll see CPI data for August. Inflation has been quietly running warmer-than-expected over the past three months, boosted by the continued and persistent rise in housing costs (CPI: Shelter). Finally, we'll take a look at retail sales data, which has actually held-up rather well this summer despite this year's reacceleration in store closings and continued weakness in retail hiring.

For an in-depth analysis of all real estate sectors, be sure to check out all of our quarterly reports: Apartments, Homebuilders, Student Housing, Single-Family Rentals, Manufactured Housing, Cell Towers, Healthcare, Industrial, Data Center, Malls, Net Lease, Shopping Centers, Hotels, Office, Storage, Timber, and Real Estate Crowdfunding.


Disclosure: An investor cannot invest directly in an index and index performance does not reflect the deduction of any fees, expenses or taxes. The information presented does not reflect the performance of any fund or other account managed or serviced by Hoya Capital Real Estate. We consider the information in this presentation to be accurate, but we do not represent that it is complete. It should not be relied upon as the sole source of suitability for investment. Please consult with your investment, tax or legal adviser regarding your individual circumstances before investing. Visit our website for a complete definition of all indexes cited in this report. Investing involves risk and loss of principal is possible.


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Hoya Capital Real Estate ("Hoya Capital") is an SEC-registered investment advisory firm that provides investment management services to ETFs, individuals, and institutions, focusing on portfolio and index management of publicly traded securities in the real estate industry. It is not possible to invest directly in an index. Index performance cited in this website or commentary does not reflect the performance of any fund or other account managed or serviced by Hoya Capital Real Estate. Nothing on this site nor any published commentary by Hoya Capital is intended to be investment, tax, or legal advice or an offer to buy or sell securities. Information presented is believed to be factual and up-to-date, but we do not guarantee its accuracy and should not be considered a complete discussion of all factors and risks. Data quoted represents past performance, which is no guarantee of future results. Investing involves risk. Loss of principal is possible. Investments in companies involved in the real estate and housing industries involve unique risks, as do investments in ETFs, mutual funds, and other securities. Hoya Capital has no business relationship with any company discussed/mentioned. Hoya Capital never receives compensation from any company discussed/mentioned. Hoya Capital, its affiliate, and/or its clients and/or its employees may hold positions in securities or funds discussed on this website and our published commentary. A complete list of holdings and other important disclosures and definitions are available by clicking the links below.

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