Millennials Should Consider This Investment Strategy Amidst Homeownership Challenges

As home ownership becomes elusive for Millennials and Gen Z, Apartment real estate investment trusts (REITs) offer a compelling investment alternative. In this article, we’ll explore two apartment REITs with yields up to 4.5% that could be bought right now.

Essex Property Trust

Essex Property Trust ESS owns and manages a portfolio of 252 apartment communities consisting of approximately 62,000 apartment units across eight major U.S. markets on the West Coast, including Los Angeles, Orange County, San Diego, San Francisco, Oakland, and Seattle.

Essex currently pays a quarterly dividend of $2.31 per share, equating to $9.24 per share annually, which gives it a yield of about 3.9% at the time of this writing. Essex is also a serial dividend raiser. It has raised its annual dividend every year since its initial public offering in 1994, resulting in an incredible 29 year streak, and it's very likely that this streak extends to 30 years in 2024. 

With a high yield and long track record of dividend growth, Essex is one of the most attractive dividend stocks in the real estate industry.

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Equity Residential

Equity Residential EQR owns and manages a portfolio of 305 properties consisting of 80,683 apartment units in major cities across the U.S., including Atlanta, Austin, Boston, Dallas, Denver, Los Angeles, New York, San Francisco, Seattle, and Washington, D.C.

Equity Residential currently pays a quarterly dividend of $0.6625, which equates to $2.65 per share annually and gives it a yield of about 4.5% at the time of this writing. The company has also raised its annual dividend for two consecutive years, making it both a high-yield and dividend-growth opportunity for investors.

Arrived Homes

You can also gain exposure to the benefits of homeownership through Arrived Homes.

Arrived is an alternative investment platform, backed by Jeff Bezos and Dara Khosrowshahi, that allows individuals to easily invest in real estate by purchasing shares of rental properties. Investors on the platform earn passive income through the rental revenue while waiting for the properties they invest in to appreciate in value over time.

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• Collecting passive income from real estate just got a whole lot simpler. A new real estate fund backed by Dara Khosrowshahi gives you instant access to a diversified portfolio of rental properties, and you only need $100 to get started.

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