Why are real-estate stocks/etf's going through the roof?

Question

I am a young investor trying to decide my allocation of etf's. my choices are the following symbols. vti, efa, iyr, iym, agg. i plan to allocate the most to vti. but iyr has had incredible gain over the years, but i think maybe it may fluctuate a little too much for my taste to allocate alot to it. advice?

Answer 1

what time frame are you looking at? how often do you rebalance your allocation?

Right now, I wouldn't be overly bullish on real estate, although they are getting a little of a bounce after dropping 50-60% in the last year. So maybe they've finally hit rock bottom now that the interest rate hikes seem to be slowing down. But the higher the rates go, the lower the real estate stuff goes. So just be aware!

Answer 2

Id watch out on real estate companies, especially real state developers. Where I live they are having to slash prices to get people to move in now after the real estate bubble popped. My town has around half a million people so it is a good sample. The same goes with construction companies that mainly build homes.

I like to play it safe and stick my money into long-term high-dividend stocks that may fluctuate in the short run but will, in the end, go up and split and keep repeating. We are both young so make sure you have a special portfolio set aside with safer stocks for the long haul. Of course, reinvest the dividends because no one likes money just sitting there.

Answer 3

REIT boom largely played out. Not likely to fluctuate as much as some of the others but may be headed down. People starved for income charged into REITS. Rising rates gives them other places to earn solid interest. http://www.etfconnect.com/select/fundpages/etf_funds.asp?MFID=44556 I hope you have been to etfconnect.com VTI probably not #1 place. EWA & IAU fit the current scenario. [e-mail] if want to discuss. I love to.