In an interesting view on whether it is a good time to buy REITs, some have taken the view that it may well be so long as you know where to look in terms of property sub-sectors.
In the views of Investors Chronicle there are appealing characteristics of buying REITs such as they are more tax-efficient structures and have a good chance of long-term returns due to investment in property.
However, whilst some REITs have floundered since Brexit, a number of prospered with SEGRO and Tritax both recording 1 year double-digit gains. It is asserted that some REITs have better underlying defensive characteristics which could make them good buys if understood:
Canny operators will also spot that, despite the current climate of uncertainty, there are certain subsectors of the property market that have more defensive characteristics. Private healthcare is a good example. With the number of people over 85 expected to double in the next 20 years, taxpayers’ money is more efficiently used by providing for those unable to care for themselves with care home accommodation rather than blocking up hospital beds, where, apart from anything else, the cost of care is much higher.
One of the latest recruits to sign up for this is Impact Healthcare Reit, which plans to undertake an initial public offering on the London Stock Exchange with a view to issuing shares to raise £160m.