It's hardly a secret that the stock market is down right now. And while that's not a great thing for individual investors, it can spell opportunity.

When stock values fall, it's possible to buy up shares of quality companies at a discount. And that's a strategy I'm eager to employ.

Meanwhile, when I seek out investments for my portfolio, I tend to focus on growth opportunities -- meaning, companies whose share price is likely to grow over time. But these days, I'm also inclined to load up on income-producing investments that are a fairly safe bet during periods of economic decline. And residential REITs fit the bill in both regards.

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Why I'm looking more closely at residential REITs

REITs, or real estate investment trusts, are companies that own and operate portfolios of properties and derive revenue from leasing activity. Within the realm of REITs, there are different sectors you can look at. But one of the sectors I'm focused on right now is residential REITs.

Residential REITs maintain portfolios of residential properties, like apartment buildings. Like all REITs, residential REITs are required to share a large chunk of their income with shareholders in dividend form. Currently, that's a plus, because my portfolio is very much down right now, so the idea of more income makes me feel better.

But another reason I'm interested in residential REITs is that they're fairly recession-proof. Even during periods of economic decline, people will always need to put a roof over their heads. And since many financial experts are sounding recession warnings, now seems like a good time to add residential REITs to my portfolio.

Not only are residential REITs a good asset to hold during a recession, but right now, they're a solid bet due to the state of the real estate market. The housing market has been starved for inventory since the latter part of 2020, and that's led to a huge surge in buyer demand. Over the past two years, home prices have skyrocketed, making it more difficult for entry-level buyers to break in.

Meanwhile, over the past few months, mortgage rates have risen sharply. That, combined with sky-high home prices, has pushed even more prospective buyers out of the market.

Because it's so difficult and expensive to buy a home right now, many people are sticking to renting instead. That could, especially in the near term, be a good thing for residential REITs.

Are residential REITs right for you?

For me, residential REITs represent an opportunity to diversify my holdings, generate income in my portfolio, and invest in an asset that's likely to retain its value during a period of economic decline. But don't just buy residential REITs because that's something I'm looking at. Instead, assess your portfolio and see if they fit into your strategy.

You may decide that you'd like some recession-proof assets of your own, or that residential REITs will help you branch out in your portfolio. Those are good reasons to buy them, so think about your investment mix and goals and figure out how residential REITs might fit in.