Hoya Capital Real Estate, a research-focused investment advisor specialising in real estate securities, has launched HOMZ, an exchange traded fund (ETF) offering diversified exposure across the entire US housing sector.
“The US Housing market is one of the largest, and arguably the most important, asset class in the world,” says Alex Pettee, CFA, President of Hoya Capital Real Estate. “We believe HOMZ has the potential to be the new barometer for the performance of the US housing sector. By offering representative exposure to transformative sectors like real estate technology, we believe that HOMZ provides a modernised and highly intuitive evolution in the homebuilding and real estate categories.”
Listed on the New York Stock Exchange, HOMZ seeks to track the Hoya Capital Housing 100 Index, a rules-based index designed to track the 100 companies that collectively represent the performance of the US housing sector including home builders, home rental operators, home services and technology firms, and home improvement companies.
Housing is the single largest annual expenditure for the average American household, accounting for a third of average annual spending.1 Housing costs, as measured by the CPI inflation index, have outpaced average wage growth in every year since 2012, pushing traditional homeownership farther out of reach for millions of households.
“At inception, HOMZ was conceived as a way for the 100 million renters in America to gain access to an asset class that was previously out of reach, as well as a way for homeowners to diversify their concentrated housing-related exposure,” Pettee says. “With housing costs and rents continuing to rise, we think that HOMZ could be a core component of millions of household’s asset allocation. We think that financial advisors will potentially find this ETF to be a compelling solution for their clients who are impacted by rising rents and housing costs.”
Hoya Capital sees potential interest in HOMZ from institutional investors as well. “For institutional investors, we believe that HOMZ is potentially the most efficient way to express a directional view on the US housing market or to hedge an existing exposure,” says Professor Jonathan Morris, Executive Vice President of Hoya Capital and an Adjunct Professor at Georgetown University. “Institutions hold trillions of dollars of housing-related assets and liabilities.3 By offering representative exposure to the US housing sector, we think HOMZ addresses a significant investment need for both institutions and individuals.”
HOMZ, which expects to distribute dividends monthly*, is the first ETF from Hoya Capital Real Estate. “We founded Hoya Capital Real Estate with the mission of making real estate more accessible to all investors,” Pettee adds. “We think HOMZ has the potential to fundamentally disrupt the US housing industry by lowering the hurdle for efficient access to equity ownership of the housing sector.”