Fears that the Federal Reserve will eventually knock the market back with a tapering of mortgage-backed securities have made some in the market more skeptical of real estate funds. Rising interest rates didn't help that much. But one analyst quoted in the Wall Street Journal has a different take:

After generally rising strongly over the past few years, the funds have fallen an average of about 12% since late May, when the Federal Reserve signaled it might soon scale back its bond-buying program and interest rates started to climb. (Although the Fed surprised the market in September by maintaining its monthly bond purchases, most see the move as only temporary.)

But some professionals say that even though rising interest rates are negative for real-estate funds in the short term, investors shouldn't give up on the group yet.