IYR vs VNQ Stock Comparison: AI Score, Valuation, Performance and Upside
IYR and VNQ are both broad US REIT ETFs with similar holdings but meaningfully different expense ratios. VNQ at 0.13% is roughly one-third the cost of IYR at 0.40%. Both provide diversified exposure to US commercial real estate through REITs. The primary reason to choose one over the other is cost — VNQ's lower expense ratio provides a structural long-term advantage that compounds significantly over 20+ year holding periods.
IYR vs VNQ is essentially the same US REIT market exposure at meaningfully different cost — VNQ at 0.13% vs IYR at 0.40% creates a 0.27% annual headwind for IYR investors that compounds into meaningful wealth difference over long periods, making VNQ the preferred low-cost REIT allocation for most investors.
VNQ holds the edge across 4 of 5 key metrics in this comparison. VNQ has delivered stronger 1-year price return (+4.62% vs +3.85% for IYR).
- hold iShares/BlackRock ETFs as a platform preference and receive commission-free trading on IYR at their brokerage
- value IYR's long track record since 2000 providing extensive historical data through the 2008 financial crisis and COVID real estate stress
- want broad REIT exposure and are willing to pay 0.40% for the iShares platform relationship
- are comfortable with the 0.27% annual cost premium vs VNQ given platform or liquidity preferences
- prefer the lower-cost REIT ETF at 0.13% vs IYR's 0.40% — the primary reason most investors choose VNQ over IYR
- value Vanguard's structural cost-minimization advantages for building a low-expense REIT allocation
- want the REIT ETF used by most institutional and retail investors as the de facto real estate index standard
- are comfortable with Vanguard's REIT index methodology and the commission-free availability at most major brokerages
| Metric | IYR | VNQ |
|---|---|---|
| ETF scorei | 34.0 | 38.0 |
| Latest closei | $98.00 | $92.91 |
| 1M returni | -5.79% | -5.78% |
| 6M returni | +6.17% | +6.74% |
| 1Y returni | +3.85% | +4.62% |
The ETF score weights long-term returns and risk-adjusted performance most heavily, but still rewards low expense ratios, larger fund size, and broader diversification — so it can favor low-cost, broad, mega-cap funds over smaller thematic or actively-managed funds even when the latter have delivered stronger returns.
How much would $10,000 be worth today if invested at the start of each period, with all dividends reinvested?
| Period | IYR | VNQ |
|---|---|---|
| 1Y ago | $10.64K (+6.4%) started 2025-09-18 | $10.87K (+8.7%) started 2025-09-18 |
| 5Y ago | $12.2K (+22.0%) started 2021-09-20 | $13.14K (+31.4%) started 2021-09-20 |
| 10Y ago | $23.38K (+133.8%) started 2016-09-19 | $25.64K (+156.4%) started 2016-09-19 |
Hypothetical — past performance does not guarantee future results.
| Metric | IYR | VNQ |
|---|---|---|
| Expense ratioi | 0.37% | 0.13% |
| Total assets (AUM)i | $4.39B | $70.82B |
| Dividend yieldi | 2.21% | 3.60% |
| Trailing P/Ei | 27.04 | 29.09 |
| Betai | 0.98 | 0.99 |
| 52-week change | 3.85% | 4.62% |
| Metric | IYR | VNQ |
|---|---|---|
| 1Y returni | +3.85% | +4.62% |
| 6M returni | +6.17% | +6.74% |
| 1M returni | -5.79% | -5.78% |
| 1Y Sharpe ratio | 0.02 | 0.07 |
| Betai | 0.98 | 0.99 |
| Dividend yieldi | 2.21% | 3.60% |
| 5Y CAGR | +1.09% | +1.26% |
Over the past year, IYR and VNQ have moved strongly in the same direction (correlation of 1.00), based on daily returns.
Lower drawdown and smaller single-period drops generally indicate a smoother ride, though they do not guarantee lower future risk.
| Period | Metric | IYR | VNQ |
|---|---|---|---|
| 1Y | Growthi | +3.85% | +4.62% |
| CAGRi | +3.85% | +4.62% | |
| Volatilityi | 13.75% | 13.58% | |
| Sharpe ratioi | 0.02 | 0.07 | |
| Sortino ratioi | 0.02 | 0.10 | |
| Max drawdowni | 8.54% | 8.34% | |
| Current drawdowni | 7.96% | 7.96% | |
| Avg drawdowni | 2.36% | 2.30% | |
| Ulcer Indexi | 3.05% | 2.98% | |
| Max daily dropi | 3.13% | 3.10% | |
| Max wkly dropi | 4.96% | 4.81% | |
| 5Y | Growthi | +5.59% | +6.47% |
| CAGRi | +1.09% | +1.26% | |
| Volatilityi | 18.80% | 18.87% | |
| Sharpe ratioi | -0.09 | -0.08 | |
| Sortino ratioi | -0.12 | -0.11 | |
| Max drawdowni | 33.74% | 34.48% | |
| Current drawdowni | 7.96% | 7.96% | |
| Avg drawdowni | 13.94% | 14.51% | |
| Ulcer Indexi | 16.37% | 16.96% | |
| Max daily dropi | 4.93% | 5.00% | |
| Max wkly dropi | 11.87% | 12.07% | |
| 10Y | Growthi | +65.01% | +59.99% |
| CAGRi | +5.14% | +4.81% | |
| Volatilityi | 20.33% | 20.70% | |
| Sharpe ratioi | 0.13 | 0.11 | |
| Sortino ratioi | 0.17 | 0.16 | |
| Max drawdowni | 42.32% | 42.40% | |
| Current drawdowni | 7.96% | 7.96% | |
| Avg drawdowni | 9.96% | 10.38% | |
| Ulcer Indexi | 13.33% | 13.72% | |
| Max daily dropi | 16.87% | 17.73% | |
| Max wkly dropi | 24.93% | 24.91% |
| Category | IYR | VNQ |
|---|---|---|
| Fund name | iShares U.S. Real Estate ETF | Vanguard Real Estate Index Fund ETF Shares |
| Type | ETF | ETF |
| Expense ratioi | 0.37% | 0.13% |
| Total assets (AUM)i | $4.39B | $70.82B |
| Dividend yieldi | 2.21% | 3.60% |
- Comprehensive US REIT exposure across all property types — data centers, apartments, industrial warehouses, retail, and specialty healthcare REITs
- Long track record since 2000 with extensive historical performance data through multiple real estate cycles
- iShares/BlackRock platform provides institutional-quality ETF with deep liquidity
- 0.13% expense ratio provides the same REIT market exposure as IYR at one-third the cost — significant long-term compounding advantage
- Tracks MSCI US Real Estate index with comprehensive REIT coverage and well-established index methodology
- Vanguard's structural advantages (investor-owned fund company) support continued cost minimization
- 0.40% expense ratio is significantly higher than VNQ's 0.13% — meaningful cost difference on large REIT allocations over time
- Rising interest rates compress REIT valuations — REITs use leverage and high dividend yields compete with Treasury bonds for income investors
- Data center and cell tower REIT classification (sometimes in communication services rather than real estate) affects composition
- Rising interest rates compress REIT valuations — same rate sensitivity as IYR; VNQ's lower cost does not eliminate REIT rate risk
- Real estate cycles can produce prolonged drawdowns — COVID reduced office and retail REIT values significantly
- Individual REIT selection within VNQ means concentration in largest REITs (Prologis, American Tower) by market cap weighting
Want deeper AI forecasts?
This comparison page is public and free forever. Subscribers can unlock saved watchlists, full AI rankings, detailed forecasts, and interactive analysis tools.