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Hoya Capital Housing (HOMZ): A Well-Built ETF

This fund invests in all aspects of the real estate market.

Housing represents the largest slice of the average American’s annual spending, at 33%. Yet the few housing-related exchange-traded funds available to investors overlook huge chunks of the market. Some invest in builders of single-family homes and home-improvement stores but forgo multifamily investments such as apartment real estate investment trusts. ETFs that do hold these REITs, meanwhile, often leave out the homebuilders and DIY shops. With the Hoya Capital Housing ETF (symbol HOMZ), you can invest in all three categories, and more.

HOMZ is offered by investment adviser Hoya Capital Real Estate. The ETF tracks the Hoya Capital Housing 100 index, made up of 100 stocks. The ETF puts 30% of assets in homebuilders and construction stocks, and another 30% in real estate operators such as apartment REITs. It then allocates 20% to home-improvement retailers, furniture stores and the like, and the last 20% to home financing, technology and services companies.

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Low mortgage rates, slower-growing home prices and a glut of millennials hitting their prime home-buying years bode well for the housing industry. HOMZ provides access to an array of businesses poised to benefit.

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The fund, launched in March 2019, has no track record to speak of. And assets, although growing well, are still small. That makes HOMZ speculative, but its approach is promising. Since its debut, the ETF has returned 17.6%, compared with 12.4% for Standard & Poor’s 500-stock index over the same period.

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