MichealKnight
Full time employment: Posting here.
- Joined
- May 2, 2019
- Messages
- 520
It might be paywalled so I'm quoting parts of it. Don't want it to be "a naked link" but I also don't want it to violate copyright.
https://www.cnbc.com/2022/12/20/bon...as-fed-rate-hikes-hit-the-housing-market.html
"Bond King’ Bill Gross likes these REITs as Fed rate hikes hit the housing market"
The Federal Reserve’s commitment to fighting inflation through increasing rates could have a big impact on the residential real estate market, the Pimco founder said on CNBC’s “Halftime Report” on Tuesday, calling it a “caution” to the housing market. Specifically, if the central bank continues hiking rates, “the ability to equitize some of your housing, which is moving down in price, is going to be severely limited.”
"Nevertheless, he described the state of residential real estate as being “a little bit better” than commercial, and the Bond King has spotted an opportunity in mortgage REITs with yields of 14% to 16%. He identified Annaly Capital Management and AGNC Investment Corp as two he likes, adding that he bought some of the former earlier in the day."
“They depend upon the 30-year mortgage moving down … from 6% to close to 5%,” he said of REITs. “Ultimately if that spread narrows between 30-year mortgages and 10-year Treasurys, that 14%, 15%, 16% is a pretty good return"
"Gross noted that both Annaly and AGNC are “volatile” but said the spreads have widened “so much.”
https://www.cnbc.com/2022/12/20/bon...as-fed-rate-hikes-hit-the-housing-market.html
"Bond King’ Bill Gross likes these REITs as Fed rate hikes hit the housing market"
The Federal Reserve’s commitment to fighting inflation through increasing rates could have a big impact on the residential real estate market, the Pimco founder said on CNBC’s “Halftime Report” on Tuesday, calling it a “caution” to the housing market. Specifically, if the central bank continues hiking rates, “the ability to equitize some of your housing, which is moving down in price, is going to be severely limited.”
"Nevertheless, he described the state of residential real estate as being “a little bit better” than commercial, and the Bond King has spotted an opportunity in mortgage REITs with yields of 14% to 16%. He identified Annaly Capital Management and AGNC Investment Corp as two he likes, adding that he bought some of the former earlier in the day."
“They depend upon the 30-year mortgage moving down … from 6% to close to 5%,” he said of REITs. “Ultimately if that spread narrows between 30-year mortgages and 10-year Treasurys, that 14%, 15%, 16% is a pretty good return"
"Gross noted that both Annaly and AGNC are “volatile” but said the spreads have widened “so much.”