Finally, Morningstar analyst Abby Woodham in a recent report analyzed past periods in which interest rates rose and the performance of this asset class. Aside from interest rates, REITs are tied to the overall health of the property market and U.S. economy.
Between June 2004 and August 2006, as the Fed raised rates, REITs advanced 65% vs. 21% for the S&P 500. "Higher rates were offset by the surging housing market and broad gains in the equity market at large," wrote Woodham.
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