The Globe and Mail reports in its Wednesday edition that Canadian real estate investment
trusts are the cheapest relative to
their United States peers since the financial
crisis. A Bloomberg dispatch to the Post reports that
McLean & Partners Wealth Management manager Anil Tahiliani says: "It's a good time to invest in Canadian
REITs. ... They're partly reflecting
concerns about the Canadian
economy, housing and the effect
of low oil. But we're going to be in
a low-interest-rate environment,
and Canada is still better off."
Real estate values north of the 49th parallel have fallen as oil prices drop by half and the Canadian dollar slides. That has lowered the price of Canadian REITs, and pushed their yields more than two percentage points above U.S. REITs.
As the U.S. real estate market recovered from the financial crisis, property stocks have rallied. The 165-company U.S. Bloomberg REIT index has gained 136 per cent since the start of 2009, compared with a 100-per-cent increase for their Canadian peers.
Sentry manager Michael Missaghi says, "That spread is very wide right now between U.S. and Canada, so on that basis Canada looks attractive."
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