VNQI vs. HAUZ: These ETFs Offer Investors Exposure to Real Estate Around the World

Both the Vanguard Global ex-U.S. Real Estate ETF (NASDAQ:VNQI) and Xtrackers International Real Estate ETF (NYSEMKT:HAUZ) offer exposure to real estate companies outside the United States, appealing to investors seeking global diversification beyond domestic property markets. This comparison highlights how each fund’s cost, performance, sector mix, and risk profile could matter for those weighing an allocation to international real estate equities.

Snapshot (cost & size)

*Beta measures price volatility relative to the S&P 500; beta is calculated from five-year weekly returns. The 1-yr return represents total return over the trailing 12 months.

Both funds have very similar metrics, with HAUZ having slightly lower investor expenses. But VNQI does edge out HAUZ in terms of dividend yield.

Performance & risk comparison

What's inside

VNQI focuses on global real estate, excluding the U.S., holding 742 assets as of Jan. 8, 2025. Top holdings include Goodman Group (ASX:GMG.AX), Mitsui Fudosan Co., Ltd. (JPX:8801.T), and Mitsubishi Estate Co., Ltd. (JPX:8802.T). The fund has been in existence for nearly 15 years and is the largest global real estate ETF in terms of total assets, trailing only the iShares Global REIT ETF (NYSEMKT:REET).

HAUZ has a very similar makeup to VNQI. However, the HAUZ is three years younger and excludes companies from Pakistan and Vietnam, along with the U.S., contributing to the fund having nearly 300 fewer total holdings than VNQI.

What this means for investors

With very similar metrics and performance, either ETF is an ideal option for those who are looking to invest in global real estate. However, one of the biggest things investors should be aware of is the payout frequency of each of these ETFs.

The most common payout frequency for dividends across all assets is quarterly. But with HAUZ, dividends have been historically paid out semiannually, resulting in only two dividend payments per year. And with VNQI, the fund switched from quarterly to annual payments in 2023. The benefit of less frequent paid dividends is that investors receive a larger lump sum payment, which should be higher than the typical quarterly payment within the sector. For those who'd rather invest in global real estate ETFs with quarterly dividend payouts, they can search for similar ETFs such as the SPDR Dow Jones Global Real Estate ETF (NYSEMKT:RWO) and REET.

Glossary

ETF: Exchange-traded fund, a security that tracks an index or sector and trades like a stock.
Dividend yield: Annual dividends paid by a fund or stock, expressed as a percentage of its price.
Expense ratio: Annual fee, as a percentage of assets, that a fund charges to cover operating costs.
Beta: A measure of an investment's volatility compared to the overall market, usually the S&P 500.
AUM: Assets under management; the total market value of assets a fund manages.
Max drawdown: The largest percentage drop from a fund’s peak value to its lowest point over a period.
Ex-dividend: The date after which new buyers of a fund or stock are not entitled to the next dividend payment.
Pure-play: A fund or company focused almost entirely on a single industry or sector.
Sector allocation: The percentage of a fund’s assets invested in different industry sectors.
Tracking: How closely a fund follows the performance of its target index.
Liquidity: How easily an asset or fund can be bought or sold without affecting its price.
Total return: The investment's price change plus all dividends and distributions, assuming those payouts are reinvested.

For more guidance on ETF investing, check out the full guide at this link.

Adé Hennis has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.