Why Are Real Estate Stocks Down?

In my experience, real estate stocks tend to decline when broader economic conditions tighten, especially around interest rate hikes or uncertainty in the housing market. When borrowing costs rise, it impacts both commercial and residential real estate values. Investors often anticipate slower growth in property values or reduced rental income, which leads to selloffs in publicly traded REITs and real estate-related companies. Additionally, when inflation is high, construction costs and maintenance expenses increase, squeezing profit margins. However, it’s important to remember that real estate is cyclical — dips in stock performance often create buying opportunities for long-term investors who understand the enduring value of tangible assets like property.