1 No-Brainer Vanguard ETF to Invest $1,000 Into This July
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In real estate has been a great way to grow wealth over the long term. Real estate tends to steadily appreciate in value, typically at rates above inflation. In addition, real...
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real estate
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July 7, 2025
08:14 PM
The Motley Fool
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In real estate has been a great way to grow wealth over the long term
Real estate tends to steadily appreciate in value, typically at rates above inflation
In addition, real estate investments generate income
One of the easiest and most cost-effective ways to invest in real estate is to purchase a real estate investment trust (REIT)
The simplest way to invest broadly in REITs is through an exchange-traded fund (ETF), such as the Vanguard Real Estate ETF (VNQ -0
Those and other features make it a no-brainer to invest $1,000 in the Vanguard ETF this July
Image source: Getty Images
Become a real estate mogul with one fund The Vanguard Real Estate ETF invests broadly across the entire REIT sector
It holds over 150 REITs in all perty sectors
Its biggest holdings are the largest REITs: Vanguard Real Estate II Index Fund Institutional Plus s (14% of its net assets): An index fund that invests in REITs
Logis (6%): The leading industrial REIT focused on logistics perties
American Tower (5. 9%): A leading tower and data center REIT
Welltower (5. 4%): A healthcare REIT primarily focused on senior housing perties
Equinix (4. 4%): A leading data center REIT
Simon perty (3. 1%): A leading mall REIT
Realty Income (2. 94%): A diversified net lease REIT with retail, industrial, gaming, and other perties
Public Storage (2. 7%): A leading self-storage REIT
Crown Castle (2. 6%): A large U
As that group demonstrates, the fund offers investors diversified exposure to commercial real estate
Its largest holdings have excellent records of growing value for investors
For example, Realty Income has increased its monthly dividend 131 times since its public market listing in 1994, including for the past 111 consecutive quarters
The REIT has grown its dividend at a 4. 2% compound annual rate during that period
That growing dividend has helped Realty Income der a robust 13. 6% compound annual total return since its listing three decades ago
Logis has also been a value-creating machine
Despite its massive size, the logistics behemoth has grown its core funds from operations (FFO) per at a 12% compound annual rate over the past five years
That's faster than the S&P 500's 9% and the 6% for other REITs
It has also dered robust compound annual dividend growth during that period of 13% compared to 6% for REITs and 5% for the S&P 500
Solid total returns The Vanguard Real Estate ETF has been a solid performer over the years
The REIT ETF has dered a 7. 4% average annualized total return since its inception in September 2004
At that rate, the fund would have turned a $1,000 investment into over $4,400: VNQ Total Return Level data by YCharts Dividends paid by the REITs and reinvested into the fund have been a big driver of the ETF's total return
The Vanguard Real Estate ETF currently has a 3
A $1,000 investment would generate $36 of annual income at that rate
The combination of value appreciation and income should enable this fund to continue ducing solid returns for investors
If the fund can maintain its current annualized return, it could turn a $1,000 investment made this July into $9,145 in 30 years
There's no guarantee the fund can der that level of return in the future
However, REITs have outperformed stocks over the last 20-plus years
Given that data, the fund could potentially duce even higher returns over the long haul
A wise investment Real estate has historically been a sound long-term investment
Vanguard makes it easy to add real estate to your portfolio through the Vanguard Real Estate ETF
The fund has been a solid performer over the long term, benefiting from the growth and income duced by REITs
Those features make it a no-brainer to invest $1,000 in this ETF this July
Matt DiLallo has positions in American Tower, Crown Castle, Equinix, logis, Public Storage, Realty Income, and Simon perty Group and has the ing options: long January 2026 $170 calls on American Tower and short January 2026 $175 calls on American Tower
The Motley Fool has positions in and recommends American Tower, Crown Castle, Equinix, logis, Realty Income, Simon perty Group, and Vanguard Real Estate ETF
The Motley Fool recommends the ing options: long January 2026 $180 calls on American Tower, long January 2026 $90 calls on logis, and short January 2026 $185 calls on American Tower
The Motley Fool has a disclosure policy.
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