Economic Conditions: Strong economic growth typically leads to higher occupancy rates and rental income for REITs, pushing their prices up. Conversely, recessions can decrease demand for real estate, negatively affecting REIT prices. Interest Rates: Rising interest rates can make REITs less attractive because borrowing costs increase, reducing profitability. Higher rates also make bonds more appealing, potentially diverting investment from REITs. Inflation: While REITs can act as an inflation hedge due to increasing rental rates, high and unexpected inflation can erode returns and impact net operating income if expenses increase faster than rental income. Real Estate Market Conditions: Local and national real estate trends significantly influence REIT prices. Factors like supply and demand for specific property types, vacancy rates, and rental growth rates directly affect a REIT's revenue and profitability. Company-Specific Factors: Management quality, portfolio diversification, leverage levels, and operating efficiency are crucial factors. Strong management and a well-diversified portfolio can boost investor confidence. Dividends: REITs are known for their dividends. The dividend yield and payout ratio influence investor demand. Higher and sustainable dividend yields tend to support REIT prices. Market Sentiment: Overall investor confidence and market trends impact REIT valuations. Positive sentiment generally favors higher REIT prices, while negative sentiment can lead to sell-offs.