Low Valuation of Residential J-REITs Overlooks a Key Factor-Stability of Rental Income

2008年12月26日

(Kazumasa Takeuchi)

J-REITs specializing in residential properties are now extremely undervalued. However, residential rents tend to be far less volatile than office rents, and thus likely to offer greater cash flow stability even in economic downturns. In particular, residential J-REITs enjoy lower vacancy rates than the private sector average due to their newer properties and superior management and leasing capabilities. Thus despite concerns about the long-term effect of population decline on housing demand, we predict residential J-REITs can continue to earn a relatively stable rental income.

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