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The theory goes something like this: In a recession investors tend to have a "flight to quality", which usually means buying more government bonds, which pushes their interest rates lower. REITs tend to have relatively higher yields, so in comparison to government bonds, REITs become more attractive and their prices go up as well.

In 2008 all real estate valuations were crushed due to the nature of the crisis, but real estate has historically been a pretty stable asset class in recessionary environments.

Right, perhaps real estate won't be such a focal point of the next recession (beyond a few bubble areas).

So in terms of recession proof REITs - commercial or residential?

Careful on some of those ETFs. Even the residential one is only 50% residential, (its nearly a third health care.) And the global one is 15% residential (its second biggest sector behind retail, and ahead of office, diversified, industrial, specialized, health care, hotel and resort.)

They are more diversified than their names may imply. You may end up with odd overlaps if you dont look at their underlying sector breakdowns.

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