A Battle of REIT ETFs: Which REIT ETF Offers Better Value for Income-Oriented Investors?

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XLRE vs ICF: Better Income Value in US REIT ETFs for SA Investors

A comparison of two US REIT ETFs shows XLRE as the more cost-effective and higher-yielding option for income seekers tuning into global real estate via the rand.

South African investors chasing income can look beyond local REITs for diversification, and US-listed REIT ETFs are a reasonable channel. Between XLRE and ICF, the former stands out for offering a cleaner value trade. XLRE’s expense ratio is just 0.08%, significantly lower than ICF’s 0.32%. That alone boosts net returns for the long haul. Coupled with a dividend yield near 3.5%, XLRE delivers higher income than ICF, which yields around 2.7%. The catch: recent one-year returns tilt slightly in ICF’s favor (4.5% vs flat), reflecting a bit more price growth. But for income-oriented investors focused on steady dividend flows and cost efficiency, XLRE makes more sense, especially when rand weakness amplifies US dollar income in local terms. Still, if the US property market faces a sharp downturn or interest rates spike more than expected, both ETFs could suffer. this is just our opinion and not financial advice