Many investors will be more than happy to see 2022 come to an end, as it has been one of the worst years for stocks since the turn of the century. Rising interest rates have been one of the major headwinds for stocks. Rates once again moved higher Wednesday with another 50-basis-point increase, and they are likely to go higher early next year. It has been especially difficult for real estate investment trusts (REITs), which are vulnerable to rising rates.
The good news is the rate increases are close to being complete, as Wednesday’s hike pushes the federal funds rate to 4.25% to 4.50%. Given that the expected terminal, or final, rate is projected to be at 5.00% to 5.25%, the Federal Reserve seems close to being done, and that bodes well for REITs, especially those of the residential variety.
Five top REITs are rated Buy at Goldman Sachs, and all make sense for income investors looking to get back into a sector that provides consistent and dependable income.
This post originally appeared at 24/7 Wall St.