In this article, we will take a look at the 11 Best Real Estate Stocks to Invest In.
One of the worst downturns in decades continues to plague the US home sector. According to figures from the National Association of Realtors, sales of existing homes dropped by a third from 2021 to almost 4 million in 2024, a nearly 30-year low. In such an environment, companies that make money from the home-buying process are attempting to maximize profits from the relatively small number of transactions.
Moreover, the broader market was thrown into another frenzy following the recent interest rate cut by the Federal Reserve. Due to their reliance on debt to finance real estate development and acquisitions, REITs are especially vulnerable to changes in interest rates. Lower rates contribute to a more favorable environment for REIT performance by reducing borrowing costs, raising valuations, and increasing investor demand for yields.
In response to mounting concerns about the U.S. labor market, the central bank dropped its benchmark rate by a quarter point on September 17 and said it would cut it twice more this year, as predicted by market analysts.
The futures market had factored in the likelihood that the Fed would lower its benchmark interest rate at future policy meetings this year and into 2026 before the rate decrease. However, compared to the market’s expectations, the Fed’s most recent predictions indicate a less aggressive path of rate cuts.
Photo by Owen Lystrup on Unsplash
Our Methodology
For our list of the best real estate stocks to invest in, we started with a list of stocks pulled from ETFs, stock screeners, and web rankings. We then utilized Insider Monkey’s Q2 2025 database to discover the best stocks held by hedge funds. The list is organized in ascending order of hedge fund sentiment around each stock.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).
11. Realty Income Corporation (NYSE:O)
Number of Hedge Fund Holders: 27
Realty Income Corporation (NYSE:O) ranks among the best real estate stocks to invest in. Following the announcement of a dual-tranche senior notes issuance, Stifel reiterated a Buy rating for Realty Income Corporation (NYSE:O) with a price target of $68 on September 26. The company priced a $800 million senior unsecured note issuance in two equivalent tranches: $400 million of 3.95% senior unsecured notes maturing in 2029 and $400 million of 4.50% senior unsecured notes maturing in 2033.
Stifel analyst Simon Yarmak estimates that the 2029 notes have an effective yield to maturity of 4.143%, while the 2033 notes offer an effective yield to maturity of 4.685%.
Realty Income Corporation (NYSE:O) is a real estate investment trust that invests in free-standing, single-tenant commercial properties in the United States, Spain, and the United Kingdom under NNN leases.
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