If You’d Invested $1,000 in AvalonBay Communities (AVB) 5 Years Ago, Here’s How Much You’d Have Today

AvalonBay Communities delivered solid returns—proving even traditional real estate can outperform some crypto plays during market downturns.

Steady Growth in Turbulent Times

While crypto investors watched portfolios swing wildly, AVB provided something radical: consistent performance. The numbers speak for themselves—no hype, no promises of moon shots, just cold hard data.

The Real Estate Edge

Unlike decentralized assets that vanish with a forgotten password, AvalonBay owns actual physical properties. Tenants pay rent in real currency—not speculative tokens that might collapse before next quarter's earnings report.

Final Analysis

Turns out sometimes the smartest move isn't chasing the next blockchain revolution—it's investing in places where people actually live. But hey, where's the fun in sensible investing when you could be watching charts at 3 AM?

Image source: Getty Images.

Capitalizing on the post-pandemic rental housing boom

The pandemic was in full effect five years ago, and it had significant impacts on the housing market. Many people in large coastal cities moved to less restrictive markets in the Sun Belt region. That migration initially affected rental housing demand in AvalonBay's Core coastal markets, weighing on its stock price.

Investors who capitalized on the residential REIT's initial pandemic-driven dip have seen solid results over the past five years. A $1,000 investment in AvalonBay's stock WOULD now be worth over $1,250 based solely on share price appreciation. Additionally, AvalonBay has consistently delivered attractive and growing dividend payments during this period. With dividends reinvested, that $1,000 investment would have grown to $1,490 today. This represents a decent 8.3% average annual total return.

AvalonBay has benefited from the recovery of rental housing demand in its CORE coastal markets, which now maintain high occupancy rates above 90% and steady rent growth of 1% to 2% annually. Meanwhile, its strategy to expand into growth markets such as Charlotte, Raleigh-Durham, Dallas-Fort Worth, and Austin in 2021 has paid off. Though occupancy rates in its expansion markets are lower, in the mid-80% range, rent growth is faster, at 2%-4% annually.

AvalonBay plans to accelerate its transition toward expansion markets, targeting 25% of its portfolio in these regions over the next several years, up from 12% today. This shift aims to drive faster rent growth, positioning the REIT to continue increasing its high-yielding dividend, which currently sits at 3.7%. These initiatives could enable AvalonBay to generate even higher total returns over the next five years, making the REIT look like a compelling long-term investment opportunity.