3 REITs Every Investor Should Know About
Real estate investment trusts (REITs) are popular investments for income investors. They buy properties, rent them out, and split the rental income with their shareholders. They also must pay out at least 90% of their taxable income as dividends to maintain a lower tax rate.
However, most REITs are sensitive to interest rates. In 2022 and 2023, rising interest rates made it more expensive to acquire new properties while kicking up headwinds for their tenants. Their dividend-paying shares also became less attractive than higher-yielding CDs and T-bills.
Yet in 2024 and 2025, the Fed cut its benchmark rate six times in a row. Those rate cuts are making REITs more desirable again, so it might be smart to invest in some of those top names before the income-driven investors rush back and drive up their valuations. Here are three top REITs which I'd recommend loading up on today: Realty Income (NYSE: O), Vici Properties (NYSE: VICI), and Digital Realty Trust (NYSE: DLR).
Source Fool.com
