3 Stocks Defining a New Era For Real Estate

The stock market can expect a resurgence in real estate stocks and funds after the December 18 Consumer Price Index fell to 2.7%, well below consensus forecasts of 3.0% or higher.

That scenario is already supporting a rally in stocks and lifting interest-rate expectations. Investors are locking in positions based on muted inflation as potential evidence that the Federal Reserve can keep easing into early 2026, sending yields lower and boosting rate-sensitive sectors like real estate.

Although economists warned that disruptions from the prolonged government shutdown are distorting the data, the market reaction was clear: hopes for lower interest rates and cheaper capital have enhanced the appeal of real estate equities and REITs as yield-oriented plays heading into 2026.

Here are the three real estate stocks set to benefit the most in 2026.

“The U.S. real estate market is tame right now, as buyer activity is consistent, but on the soft side of average,” said Chuck Vander Stelt, a Valparaiso, Indiana-based real estate agent and broker. “Multiple factors are causing this, mostly affordability and lack of available, inspirational housing for those wanting to trade up.”

Still, homebuilding stocks have a good chance to do well in 2026, with lower inflation fueling that drive. “The primary reason for this is the Federal Reserve’s putting us on a trajectory for lower interest rates and easier monetary policy,” Vander Stelt said. “Other economic stimulants can help, too, such as household income benefits from tax cuts coming in 2026.”

Real estate markets historically have served as harbingers, predicting an inflection point well before adjustments to macroeconomic conditions are visible.”

“Real estate stocks can be substantially rewarding those attuned to recessionary practices, particularly those focused on the U.S. market today,” said Sain Rhodes, a real estate analyst at Seattle-based Clever Offers.”They performed well during the pandemic boom, as close to 8% interest rate apartments at 7% and regularly financing ultra-endless equity growth wars through software, designed to eliminate expectations capital demands voluntarily.”

Homebuilder equities, at 25% to 35% less sub-primed over the last year and even less unlevered, are particularly compelling given population growth. “With the US population growing by 2.7 million people every year and housing inventory refusing to stretch beyond a 3.5-month supply, rapid growth unleashes equities-powered incentives across the U.S.,” Sain noted.

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3 Real Estate Stocks to Move Into In 2026

These real estate companies are set to shine in 2026 and beyond for sector investors.

Rocket Companies

Year-to-date performance: 65.4%

Average 12-month price target: $22-to-$25 per share with an implied upside of 11%

Trading at $18.90 per share, Detroit-based Rocket Companies (NYSE:RKT) stock is up over 65% in 2025. The company’s purchase of Redfin and Mr. Cooper Group, and expected lower mortgage rates, are highly favorable to a mortgage originator like RKT.

“Rocket will be an interesting story to see play out, mostly due to the real estate transaction segments they have accumulated,” Vander Stelts said. “That includes a strong housing market, which allows RKT to lead the sector in 2026.”

Analysts largely agree, with Oppenheimer’s Chad Larki initiating coverage on the stock with an “Outperform” rating along with a price target of $25.00. Meanwhile, Eric Hagen from BTIG reiterated a “buy” rating on RKT, also with the $25 price target.

With the Federal Reserve already slashing rates by 1.5% in 2025 and more likely on the way after a solid CPI November number, Rocket looks like it can rule the roost as more “Sold” signs start appearing on homes across the US in 2026.

Prologis Inc.

Year-to-date performance: 20.8%

Average 12-month price target: $130-to-$132 per share with a 4% implied upside.

A global leader in logistics and industrial property REITs, Prologis (NYSE:PLD) is poised to pop with robust services demand driven by e-commerce, supply-chain reshoring, and durable rental growth. As borrowing costs trend lower alongside a lower CPI, Prologis’s cost of capital should improve while portfolio valuations rise. That should translate into a classic tailwind for industrial REITs. 

That’s not news for big institutional buyers, who have historically favored Prologis for its high occupancy and pricing leverage, setting it apart from more cyclical real estate property companies. The company recently stated that PLD earnings are forecast to grow 4.3% in the current fiscal year and, like Digital Realty (see below), Prologis is one of the most reliable and stable real estate companies in the industry. The company is currently trading at $127 per share and is up 20.8% year-to-date.

Digital Realty Trust

Year-to-date performance: -16%%

Average 12-month price target: $197-to-$199 per share, with a 30% upside.

Data center REITs sit at the intersection of real estate and secular tech demand, and Digital Realty (NYSE:DLR), trading at $148 per share, leads this niche. With digital transformation and AI workloads driving demand for hyperscale facilities, Dallas-based Digital Realty’s property base is in an ideal position, particularly in a deflating inflation environment, which should remedy a long-ailing real estate market and as interest-rate pressure eases. Buying the stock at a dip right now should add even more value to the equation.

Digital Realty Trust operates primarily as a colocation provider, generating revenue by leasing its data center properties. Analysts are bullish on the company, with Goldman Sachs’ Michael Ng noting in a recent analyst note that Digital Realty is likely to see “an extended period of revenue and profit growth, supported by an extensive backlog, wide releasing spreads that are indicative of pricing opportunities, and $6.4 billion (730 MW) of data center construction under development, including DLR’s share of its joint ventures coming online in 2026.” Ng also said Digital Realty is expected to generate an 11% revenue CAGR and 12% EBITDA CAGR between 2026 and 2029.

More Takeaways on Real Estate Investment Trends

Even as green shoots finally appear in the US real estate market, investors should tread cautiously heading into 2026, with some areas remaining firmly off limits.

“I recommend avoiding exposure to traditional enclosed shopping malls and non-essential retail real estate,” Rhodes advised. “These properties have been reported to exhibit permanent, irreversible structural decay, as the adoption of remote work, corporate travel, and office real estate in secondary and tertiary markets poses a genuine risk.”

On the IT front, Rhodes recommends avoiding the highly leveraged development REITs that rely on debt refinancing in a higher-rate environment. “The cost of capital has changed fundamentally, and companies with loose balance sheets will run into trouble,” she noted.

Rhodes added that it’s now a unique period for real estate investors, particularly those who can spot quality opportunities amid this market transition, to capitalize on. “The fundamentals are significantly stronger than the headlines suggest, and patient capital, deployed strategically, will compound over the next five to ten years,” she said.