Why REITs Could Finally Wake Up in 2026: 3 ETFs Worth Your Attention

The REIT sector has been in a holding pattern for way too long. After getting hammered by rising rates in 2022-2023, things started stabilizing in 2024-2025 when the Fed cut rates five times. But here’s the catch—Treasury yields stayed stubbornly high, keeping income investors glued to bonds and CDs while many REITs treaded water.

The setup is getting spicy though. As Treasury yields continue their descent, income-hungry investors are likely to rotate back into REITs. That could spark a significant rally across the sector. If you want exposure without cherry-picking individual plays, three ETFs are worth considering:

The Stable Pick: VNQ

Vanguard’s REIT ETF is the heavyweight—153 stocks across 17 sectors. It’s basically REIT index investing at its simplest. Top holdings include Welltower (6.8%), Prologis (6.7%), and American Tower (4.8%). Yields around 3.6% (adjusted). Expense ratio? Just 0.13%. Perfect for retirees who want set-it-and-forget-it exposure.

The Pure Play: SCHH

Schwab’s ETF sticks to property-owning REITs only—no mortgage REITs, no non-REIT real estate plays. 124 holdings, similar top three stocks, 3.6% yield, even lower fees at 0.07%. If you want pure REIT exposure without the complications, this is your move.

The Growth Angle: XLRE

Here’s where it gets interesting. This one tilts heavily toward data center, logistics, and telecom tower REITs—the infrastructure driving cloud, AI, and e-commerce expansion. Only 31 holdings, so more concentrated than the other two. Yield is 3.48%, but you’re getting growth potential alongside income. Slightly riskier, but potentially juicier returns if those secular trends accelerate.

The common thread: All three have solid yields (3.48%-3.6%), rock-bottom fees (0.07%-0.13%), and zero minimum investments. The real question is which flavor suits your risk appetite—boring stability, pure-play simplicity, or growth-leaning income?