Best-Performing REITs for July 2026 and How to Invest

Real estate investment trusts (REITs) let you invest in real estate without buying and managing properties yourself.

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Updated Jul 1, 2026 · 6 min read

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What are real estate investment trusts?

Real estate investment trusts (REITs) are companies that own real estate. You can buy shares in REITs, and you mainly make money from REITs through dividends. REITs often own apartments, warehouses, self-storage facilities, malls and hotels. You can purchase many REITs through a brokerage account, similar to how you might purchase stocks.

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How does a real estate investment trust (REIT) work?

Congress created real estate investment trusts in 1960 as a way for individual investors to own equity stakes in large-scale real estate companies, just as they could own stakes in other businesses

Congress created real estate investment trusts in 1960 as a way for individual investors to own equity stakes in large-scale real estate companies, just as they could own stakes in other businesses U.S. Securities and Exchange Commission. Investor Bulletin: Real Estate Investment Trusts (REITs). Accessed Jun 2, 2026. . This move made it easy for investors to buy and trade a diversified real-estate portfolio.

REITs are required to meet certain standards set by the IRS, including that they:

Return a minimum of 90% of taxable income in the form of shareholder dividends each year. This is a big draw for investor interest in REITs.

Invest at least 75% of total assets in real estate or cash.

Receive at least 75% of gross income from real estate, such as real property rents, interest on mortgages financing the real property or from sales of real estate.

Have a minimum of 100 shareholders after the first year of existence.

Have no more than 50% of shares held by five or fewer individuals during the last half of the taxable year.

By adhering to these rules, REITs don’t have to pay tax at the corporate level, which allows them to retain more of their profits, be less reliant on debt and thus have lower financing costs. Less tax also means more profit to disburse to investors. Accordingly, over time, REITs can grow bigger and pay out even larger dividends.

» MORE: Understand different types of real estate investments

» MORE: » MORE: Understand different types of real estate investments

What is the average return on a REIT?

When comparing potential returns to determine whether REITs are a good investment for you, it can be helpful to look at benchmarks.

The S&P 500 is an index that measures the performance of around 500 of the biggest U.S. companies. As of April 30, 2026, the three-year total return on this index was 21.69% and the five-year total return was 13.14%

The FTSE NAREIT All Equity REITs Index tracks the performance of equity REITs. As of March 2026, the three-year total return on this index was 21.9% and the five-year total return was 21.4%

The FTSE NAREIT All Equity REITs Index tracks the performance of equity REITs. As of March 2026, the three-year total return on this index was 21.9% and the five-year total return was 21.4% FTSE Russell. FTSE Nareit All Equity REITs Index. Accessed Jun 2, 2026. .

That's not to say that REITs are better or worse than stocks — benchmarks are simply one metric to look at. REITs can be a way to diversify your portfolio.

How to invest in REITs: 3 steps for beginners

Investing in REITs is as simple as opening a brokerage account, or investment account, which usually takes just a few minutes. Then you’ll be able to buy and sell publicly traded REITs just like you would any other stock (Compare NerdWallet's top-rated brokerage accounts for stock trading).

Investing in REITs is as simple as opening a brokerage account, or investment account, which usually takes just a few minutes. Then you’ll be able to buy and sell publicly traded REITs just like you would any other stock ( Compare NerdWallet's top-rated brokerage accounts for stock trading ).

Because REITs pay dividends, which can create a tax bill, it can be smart to keep them inside a tax-advantaged investment account like a Roth IRA to get the best possible tax treatment.

If you don’t want to trade individual REIT stocks, it can make a lot of sense to simply buy an ETF or mutual fund that vets and invests in a range of REITs for you. You get immediate diversification and lower risk. Many brokerages offer these funds, and investing in them requires less legwork than researching individual REITs for investment.

Best-performing REIT stocks: July 2026

Below are some of the top performing publicly listed REITs.

The best-performing REIT stock by one-year return is Diversified Healthcare Trust (DHC), which is up 145.74%.

Ticker

Company

Performance (Year)

DHC

Diversified Healthcare Trust

145.74%

CBL

CBL& Associates Properties Inc

106.57%

ILPT

Industrial Logistics Properties Trust

95.44%

PSTL

Postal Realty Trust Inc

65.96%

MAC

Macerich Co

53.28%

WSR

Whitestone REIT

51.16%

WELL

Welltower Inc

50.34%

Source: Finviz. Data is current as of July 1, 2026, and is intended for informational purposes only.

Rather than purchase individual REITs, you can also invest in REIT real estate ETFs to get instant diversification at an affordable price. Here are some top performing property-focused ETFs the past year:

Best-performing REIT ETFs: July 2026

The best-performing REIT ETF by one-year return is iShares Core U.S. REIT ETF (USRT), which is up 17.29%.

Ticker

Company

Performance (Year)

Net Expense Ratio

USRT

iShares Core U.S. REIT ETF

17.29%

0.08%

RWR

State Street SPDR Dow Jones REIT ETF

16.93%

0.25%

FRI

First Trust S&P REIT Index Fund

16.89%

0.50%

KBWY

Invesco KBW Premium Yield Equity REIT ETF

16.72%

0.35%

BBRE

JPMorgan BetaBuilders MSCI U.S. REIT ETF

15.95%

0.11%

REZ

iShares Residential and Multisector Real Estate ETF

15.28%

0.48%

SCHH

Schwab U.S. REIT ETF

11.85%

0.07%

Source: Finviz. Data is current as of July 1, 2026, and is intended for informational purposes only.

Best-performing REIT mutual funds: July 2026

Looking for mutual funds instead? Below are the five best-performing REIT mutual funds, filtered to only include no-load funds (meaning you won't pay a commission to buy or sell the fund) with investment minimums below $3,000 and expense ratios below 1%.

Ticker

Name

5-Year Return (%)

MXREX

Empower Real Estate Index Inv

5.01%

IVRSX

VY® CBRE Real Estate S

4.68%

CREFX

Cohen & Steers Real Estate Securities F

4.37%

JIREX

JHancock Real Estate Securities 1

4.35%

FRESX

Fidelity Real Estate Investment Portfolio

3.74%

Source: Morningstar. Data is current as of July 1, 2026, and is intended for informational purposes only.

Source: Morningstar. Data is current as of July 1, 2026, and is intended for informational purposes only. Source: Morningstar. Data is current as of July 1, 2026, and is intended for informational purposes only. Advertisement

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Types of REITs

REITs fall into three broad categories: equity, mortgage and hybrid REITs. Each REIT type has different characteristics and risks, so it’s important to know what’s under the hood before you buy.

1. Equity REITs

1. Equity REITs 1. Equity REITs

Equity REITs operate like a landlord, and they handle all the management tasks you associate with owning a property. They own the underlying real estate, collect rent checks, provide upkeep and reinvest into the property.

2. Mortgage REITs

2. Mortgage REITs 2. Mortgage REITs

Unlike equity REITs, mortgage REITs (also known as mREITs) don't own the underlying property. Instead, they own debt securities backed by the property. For example, when a family takes out a mortgage on a house, this type of REIT might buy that mortgage from the original lender and collect the monthly payments over time, generating revenue through interest income. Meanwhile, someone else — the family, in this example — owns and operates the property.

Mortgage REITs are usually significantly riskier than their equity REIT cousins, but they tend to pay higher dividends.

3. Hybrid REITs

3. Hybrid REITs 3. Hybrid REITs

Hybrid REITs are a combination of equity REITs and mortgage REITs. These businesses own and operate real estate properties as well as own commercial property mortgages in their portfolio. Be sure to read the REIT prospectus to understand its primary focus.

Each REIT category can further be divided into three types that speak to how the investment can be purchased: publicly traded REITs, public nontraded REITs and private REITs.

Publicly-traded REITs

As the name suggests, publicly-traded REITs are traded on an exchange like stocks and ETFs, and you can buy them through an ordinary brokerage account. There are more than 225 publicly-traded REITs on the market in the U.S

Publicly-traded REITs tend to have better governance standards and be more transparent. They also offer the most liquid stock, meaning investors can buy and sell the REIT’s stock readily — much faster, for example, than investing and selling a retail property yourself. For these reasons, many investors buy and sell only publicly traded REITs.

Public nontraded REITs

These REITs are registered with the SEC but are not available on an exchange. Instead, they can be purchased from a broker that participates in public nontraded offerings, such as online real estate broker Fundrise. (The National Association of Real Estate Investment Trusts maintains an online database where investors can search for REITs by listing status). These REITs are highly illiquid, often for periods of eight years or more, according to the Financial Industry Regulatory Authority.

These REITs are registered with the SEC but are not available on an exchange. Instead, they can be purchased from a broker that participates in public nontraded offerings, such as online real estate broker Fundrise. (The National Association of Real Estate Investment Trusts maintains an online database where investors can search for REITs by listing status ). These REITs are highly illiquid, often for periods of eight years or more, according to the Financial Industry Regulatory Authority.

Nontraded REITs also can be hard to value. In fact, the SEC warns that these REITs often don’t estimate their value for investors until 18 months after their offering closes, which can be years after you’ve invested.

Several online trading platforms allow investors to purchase shares in public nontraded REITs, including DiversyFund and Realty Mogul.

Private REITs

Not only are private REITs unlisted, making them hard to value and trade, but they are also generally exempt from SEC registration. As such, private REITs have fewer disclosure requirements, potentially making their performance harder to evaluate. These limitations make these REITs less attractive to many investors, and they carry additional risks. (See this helpful warning from FINRA on public non-traded REITs and private REITs.)

Public nontraded REITs and private REITs also can have much higher account minimums — $25,000 or more — to begin trading, and steeper fees than publicly traded REITs. For that reason, private REITs and many nontraded REITs are open only to accredited investors. These investors have a net worth (excluding the value of their primary residence) of $1 million or more, or annual income in each of the past two years of at least $200,000 if single or $300,000 if married

REIT stock pros and cons

REIT stock pros and cons Pros

Steady dividends

High returns

Liquidity

Lower volatility

Cons

Heavy debt

Low growth and capital appreciation

Tax burden

Nontraded and private REITs can be expensive and illiquid

REIT advantages

There are advantages to investing in REITs, especially those that are publicly traded.

Steady dividends: Because REITs are required to pay at least 90% of their annual income as shareholder dividends, they consistently offer some of the highest dividend yields in the stock market. That makes them a favorite among investors looking for a steady stream of income. The most reliable REITs have a track record of paying large and growing dividends for decades.

Steady dividends: Steady dividends: Because REITs are required to pay at least 90% of their annual income as shareholder dividends, they consistently offer some of the highest dividend yields in the stock market. That makes them a favorite among investors looking for a steady stream of income. The most reliable REITs have a track record of paying large and growing dividends for decades.

High returns: As noted, returns from REITs may outperform equity indexes, which is another reason they are an attractive option for portfolio diversification.

High returns: High returns: As noted, returns from REITs may outperform equity indexes, which is another reason they are an attractive option for portfolio diversification.

Liquidity: Publicly traded REITs are far easier to buy and sell than the laborious process of actually buying, managing and selling commercial properties.

Liquidity: Liquidity: Publicly traded REITs are far easier to buy and sell than the laborious process of actually buying, managing and selling commercial properties.

Lower volatility: REITs tend to be less volatile than traditional stocks, in part because of their larger dividends. REITs can act as a hedge against the stomach-churning ups and downs of other asset classes. However, no investment is immune to volatility.

Lower volatility: Lower volatility: REITs tend to be less volatile than traditional stocks, in part because of their larger dividends. REITs can act as a hedge against the stomach-churning ups and downs of other asset classes. However, no investment is immune to volatility.

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REIT disadvantages

Heavy debt: REITs, particularly private REITs, tend to have a lot of debt. However, some investors may be comfortable with this situation because REITs typically have long-term contracts that generate regular cash flow — such as leases, which see to it that money will be coming in — to support their debt payments comfortably and ensure that dividends will still be paid out.

Heavy debt: Heavy debt: REITs, particularly private REITs, tend to have a lot of debt. However, some investors may be comfortable with this situation because REITs typically have long-term contracts that generate regular cash flow — such as leases, which see to it that money will be coming in — to support their debt payments comfortably and ensure that dividends will still be paid out.

Low growth and capital appreciation: Since REITs must pay so much of their cash profits as dividends, they often have to issue new stock shares and bonds in order to raise cash to grow. Sometimes, investors are not always willing to buy those new securities, such as during a financial crisis or recession. In turn, REITs may not be able to buy real estate exactly when they want to. Accordingly, a REIT’s ability to grow is a function of investor appetite for the REIT’s stock and bonds.

Low growth and capital appreciation: Low growth and capital appreciation: Since REITs must pay so much of their cash profits as dividends, they often have to issue new stock shares and bonds in order to raise cash to grow. Sometimes, investors are not always willing to buy those new securities, such as during a financial crisis or recession. In turn, REITs may not be able to buy real estate exactly when they want to. Accordingly, a REIT’s ability to grow is a function of investor appetite for the REIT’s stock and bonds.

Tax burden: While REIT companies pay no federal corporate income taxes, their investors still must pay taxes on any dividends they receive from the REIT, unless those investors hold their REIT investments in a tax-advantaged account. (That’s one reason REITs can be a great fit for IRAs.)

Tax burden: Tax burden: While REIT companies pay no federal corporate income taxes, their investors still must pay taxes on any dividends they receive from the REIT, unless those investors hold their REIT investments in a tax-advantaged account. (That’s one reason REITs can be a great fit for IRAs .)

Nontraded REITs can be expensive: The cost for initial investment in a nontraded REIT may be $25,000 or more and may be limited to accredited investors. Nontraded REITs also may have higher fees than publicly traded REITs.

Nontraded REITs can be expensive: Nontraded REITs can be expensive: The cost for initial investment in a nontraded REIT may be $25,000 or more and may be limited to accredited investors. Nontraded REITs also may have higher fees than publicly traded REITs.

Illiquid (especially nontraded and private REITs): Publicly traded REITs are easier to buy and sell than actual properties, but as noted, nontraded REITs and private REITs can be a different story. Investors may have to hold these REITs for years to realize potential gains.

Illiquid (especially nontraded and private REITs): Illiquid (especially nontraded and private REITs): Publicly traded REITs are easier to buy and sell than actual properties, but as noted, nontraded REITs and private REITs can be a different story. Investors may have to hold these REITs for years to realize potential gains. Advertisement

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Former NerdWallet writer Jim Royal contributed to this article.

Former NerdWallet writer Jim Royal contributed to this article. Former NerdWallet writer Jim Royal contributed to this article. Neither the author nor editor held positions in the aforementioned investments at the time of publication. Neither the author nor editor held positions in the aforementioned investments at the time of publication. Neither the author nor editor held positions in the aforementioned investments at the time of publication.

Article sources

NerdWallet writers are subject matter authorities who use primary, trustworthy sources to inform their work, including peer-reviewed studies, government websites, academic research and interviews with industry experts. All content is fact-checked for accuracy, timeliness and relevance. You can learn more about NerdWallet's high standards for journalism by reading our editorial guidelines. U.S. Securities and Exchange Commission. Investor Bulletin: Real Estate Investment Trusts (REITs). Accessed Jun 2, 2026. S&P Global. S&P 500. Accessed Jun 2, 2026. FTSE Russell. FTSE Nareit All Equity REITs Index. Accessed Jun 2, 2026. Nareit. Frequently Asked Questions About REITs. Accessed Jun 2, 2026. U.S. Securities and Exchange Commission. Accredited Investors. Accessed Jun 2, 2026. About the author Kevin Voigt Kevin Voigt Kevin Voigt is a former investing writer for NerdWallet. He has covered financial issues for more than 20 years, including for The Wall Street Journal and CNN.com. See full bio.

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What are real estate investment trusts? What are real estate investment trusts? How does a real estate investment trust (REIT) work? How does a real estate investment trust (REIT) work? What is the average return on a REIT? What is the average return on a REIT? How to invest in REITs: 3 steps for beginners How to invest in REITs: 3 steps for beginners Best-performing REIT stocks: July 2026 Best-performing REIT stocks: July 2026 Best-performing REIT ETFs: July 2026 Best-performing REIT ETFs: July 2026 Best-performing REIT mutual funds: July 2026 Best-performing REIT mutual funds: July 2026 Types of REITs Types of REITs REIT stock pros and cons REIT stock pros and cons REIT advantages REIT advantages REIT disadvantages REIT disadvantages More like this Investing How Much Does a Financial Advisor Cost? Most financial advisors charge based on how much money they manage for you, but the industry average is around 1% of your asset balance per year. Arielle O'Shea Do You Need a Financial Advisor? 7 Ways to Tell You may need a financial advisor if you're facing big life changes, don't have financial goals, have complex compensation, high tax bills or for other reasons. Taryn Phaneuf How to Find Cheap or Free Financial Advice Quality financial advice is more accessible than ever — and much of it is free or inexpensive. Here's how to get it. June Sham 3 Steps to Prepare for Your First Financial Advisor Meeting Here's what think about and bring to your first meeting with a financial advisor. June Sham

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