Is now the right time for REITs?

Over the past several months, the market for initial public offerings of mortgage real estate investment trusts has increased significantly. Demand for REITs, it seems, are at an all-time high. In fact the industry has developed into a $1 trillion market with $300 billion in the U.S. and another $700 billion elsewhere, according to the National Association of Real Estate Investment Trusts. According to figures reported by the Royal Bank of Scotland, about $9 billion of equity capital has been raised this year by publicly traded mortgage REITs, according to data from mid-April. This number is focused heavily on residential real estate with the equity raised more than in any other full year. This $9 billion of equity translates into $54 billion of buying power that is likely to further translate into significant demand for existing mortgage-backed securities.

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3d rendering of a row of luxury townhouses along a street

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