Vanguard Real Estate ETF drops nearly 10% amid rising Treasury yields and Fed rate hikes

The Vanguard Real Estate ETF (VNQ) has fallen almost 10% in the last month due to rising Treasury yields and a recent Federal Reserve interest rate hike. Higher rates have reduced VNQ's income appeal, as its yield now trails the 10-year Treasury yield, causing investors to move money out of real estate investment trusts (REITs). Welltower Inc., a major holding in VNQ, is trading at record valuations but faces risks if growth slows. The recommendation is to hold VNQ shares and wait for more clarity on interest rates before making further moves.

Following the recent challenges faced by VNQ due to rising Treasury yields and Fed rate hikes, the ETF is currently trading at USD 91.06 on Pluang as of Sep 28, 2026 15:31 WIB. This price is closer to its 52-week low of USD 87.00 than its high of USD 100.95, indicating continued market caution. The market cap stands at $70.80 billion, with investors typically holding VNQ for about 112 days on the platform.