The Mystery of Low Income REITS

My sister and I inherited an apartment in western Queens, and after almost 10 years of co-owning it, we are going to sell it to her daughter. As a result, I will have a chunk of investment capital, and I will put most of it into real estate investment trusts, military stocks, and hard metals.  Western Queens--Astoria, Long Island City, and Sunnyside--is apparently on a tear. While I was walking to the apartment to meet the appraiser, I noticed multiple construction projects involving new apartment and retail structures.  Broadway in Astoria, which is near where I grew up, is a different place from what it was 20 years ago.  Even the famous Greek restaurant, Uncle George's, is gone.

The kicker is that New York State has passed a law  mandating green energy, and New York City has passed a law mandating retrofitting.  The green energy law will double real electric costs over the coming twenty years, and the retrofitting will increase costs as well. Perhaps it is a good time to escape from New York.

Gold has been on a tear, and I suspect a pullback; hence, I am going to limit the purchase and overweight silver, which hasn't gone up as much as gold yet.

I like 3M and Unilever, and I would like to put a little into defense stocks.  After a couple of setbacks in recent years, 3M is in value territory, but Unilever is somewhat overpriced.  Something tells me that drones are the weapon of the future, and firms like AeroVironment (AVAV), Boeing (BA), and Northrop Grumman are likely suspects. None of these is priced at a value level, and Boeing has had problems with tariffs and a crash investigation. Northrop Grumman (NOC) has been on a tear, and is up 48% this year. I already hold some General Dynamics and Raytheon, and I think I will add a little GD as well as AVAV and NOC.

VNQ is the Vanguard REIT index, and it is up this year, and I'm expecting to put most of the money there.  However, I would like to overweight low-income real estate, and that is a tough nut to crack because few REITs specialize in low-income real estate. This is another case of the Federal Reserve Bank economy artificially creating credit to  subsidize wealthy rather than middle class or poor Americans.

I could find three REITs and funds that focus on lower-income housing: Sun Communities (SUI), NexPoint Residential Communities (NXRT), and the Community Development Fund (CDCDX).  I already own SUI, which makes prefab housing, and it's been priced at nosebleed levels.  It's been going up 28% a year.  CDCDX is a public-private partnership that invests in low-income projects. It is a bond fund and is correlated with the bond market. Since bonds are still at historically high levels, I'll pass. I have moral concerns about public-private partnerships as well.  NXRT is is somewhat overvalued. According to NXRT's website:

The company pursues investments in class A and B multifamily real estate property, typically with a value-add component, where we can invest significant amounts of capital to provide “life style” amenities to “work force” housing. Our value-add strategy seeks to provide a nicer home to our residents, while maximizing returns for our shareholders.

The moderate-income housing market seems to be a victim of the banking cartel, the Federal Reserve Bank, which favors high-end real estate and labor-substitution investments like robotics, plant relocations, and technology.  While there is no shortage of high-income-oriented apartment REITs, there is only a handful of moderate-income-oriented ones. This may explain the overvaluation of SUI and NXRT.  As with gold, I'll buy a small amount of NXRT.