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Since the beginning of the year, it seems that most REIT ETFs have dropped around 5% (e.g., IYR) while stocks have done really well.

Were there any market/economic/political events recently that caused the price of REITs to go down?

Given that 5% is a significant drop, there should be some rational and objective explanation for it. I tried Googling for news about REITs, but you just get a bunch of sites with no useful content.

For a particular example, let's use IYR which is traded in the US.

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  • Are you including the end of 2017 and considering the end of year dividend?
    – user662852
    Commented Jan 18, 2018 at 17:52
  • @user662852, good question, but the dividend was mid December so not related to that.
    – minou
    Commented Jan 18, 2018 at 18:19
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    You might want to qualify which markets you are referring to. REITs trade on a number of exchanges in a number of countries around the world.
    – Chris W. Rea
    Commented Jan 18, 2018 at 20:43
  • @ChrisW.Rea, I had mentioned IYR, but edited the question to make it a more explicit example.
    – minou
    Commented Jan 19, 2018 at 13:33

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It's hard to give an objective answer to this question. REITs tend to behave more like bonds than like stocks. The expectation of rising interest rates, as well as a general "risk on" mood, could explain the underperformance. The effects of tax reform might also affect REITs.

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  • Yes, I expect you are right, but I was hoping there might be a more satisfactory explanation. I also noticed today that nearly all trading of IYR is at market open/close so I suspect that the trading is mostly by firms/institutions and very little by individual investors.
    – minou
    Commented Jan 22, 2018 at 17:46

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