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Stocks in companies that own apartment buildings are holding up better than most other real estate investment trusts, as a tough U.S. housing market keeps demand for rental housing healthy and tenant turnover low.

The FTSE NAREIT Equity REITs index, which includes owners of apartments, office, retail and other commercial property types, is down 2.9 percent through the first five months of this year.

The 14-company apartment segment of the index, meanwhile, had a total return of 5.2 percent in the same period. One of the nation’s largest apartment REITs, Virginia-based AvalonBay Communities, is up about 22 percent since last October. It owns and manages over 90,000 apartments across the U.S.

That performance trails only malls and health care property owners.

Still, apartments and REITs lag the S&P 500’s roughly 11.3 percent total return through the end of May.

A shortage of homes for sale and rising mortgage rates have combined to dampen home sales this spring, traditionally the busiest stretch for the housing market. Sales of previously occupied U.S. homes fell in March and April.

The median U.S. home sale price has risen more than 40 percent since 2019 alone, making it challenging for renters to save for down payments.

The resilience in apartment REITs stocks is noteworthy because it comes as landlords have seen rents fall nationally for nearly a year.

The median U.S. asking rent fell on an annual basis in April for the ninth month in a row to $1,723, according to data from Realtor.com drawn from the nation’s 50 largest metropolitan areas. Despite the string of declines, April’s figure was just 1.9 percent below its 2022 peak.

The largest wave of new apartment construction in at least 50 years is helping to put downward pressure on rents, but with many tenants priced out of homeownership, turnover is down, keeping demand healthy.

Meanwhile, a strong job market has helped drive rents higher in many metro areas, especially in the Midwest.

The median asking rent in the Indianapolis metro area jumped 4.5 percent in April to $1,334, while in Minneapolis it rose 2.5 percent to $1,529. It jumped 3.8 percent to $1,671 in Milwaukee.

Investors may want to focus on companies with properties in the West Coast and Midwest, which are expected to be less affected by the wave of new apartments than the Sunbelt, analysts at Raymond James & Associates wrote in a research note last month.

Discussing apartment REITs’ first-quarter earnings reports, the analysts highlighted “the remarkable resilience of demand, which has steadily absorbed the well-known supply wave with minimal pricing dislocation.”

They also noted that occupancy levels have held up better than expected and tenant turnover is “trending toward the lowest levels in sector history, as move-outs to homeownership have virtually dried up entirely.”

Among the analyst’s picks are Essex Property Trust and Centerspace, both of which have “Outperform” ratings.