1 Wall Street Analyst Says There's a Great Investment Hiding in Plain Sight. These 2 Dividend Stocks Are My Best Ideas for Investing in It.

The market is in a state of flux thanks to geopolitical issues around tariffs. There is a huge amount of uncertainty. If you have money to invest today, it is hard to decide what to do, since sticking cash under your mattress may feel like a good call in the midst of a dramatic market decline.

One Wall Street pro has a different tactic. Buy shares in businesses that provide a life necessity: shelter. Here are two high-yield ways to do just that.

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What's the call on Wall Street?

Maura Pape, a senior investment strategist at Bernstein Private Wealth Management, recently highlighted commercial real estate as a good investment opportunity to Bloomberg. Commercial real estate is actually a pretty big category, and small investors would have a hard time investing directly in the space, anyway. But Pape did, in fact, narrow things down, singling out multifamily as a particular opportunity.

Image source: Getty Images.

"Multifamily" sounds fancy, but it just means apartment buildings. The truth is, you could probably find a small apartment building in your own neighborhood to buy. But that might pose financial and practical challenges and wouldn't afford you diversification or scale. This is why you might be better off with an apartment-focused real estate investment trust (REIT).

There are two big stories here. First, shelter is a life necessity. It doesn't matter if the market is falling or if the economy has fallen into a recession. People still need a place to live, and that makes apartment REITs a fairly resilient property type.

Second, there has been a drop in multifamily construction projects in recent years that should help support rental rates, and thus growth, for apartment landlords.

Two well-run apartment REITs you might want to look at are AvalonBay Communities (NYSE: AVB) and UDR (NYSE: UDR). Here's why.

Well-positioned apartment REITs

AvalonBay isn't the largest apartment landlord, but it is one of the best run. It has a material focus on coastal markets, where supply has been historically constrained. It also has a long history of active portfolio management as well, buying, selling, and building assets, depending on which one leads to the best returns.

AvalonBay's portfolio activity is centered around ensuring that it has young and attractive apartments to offer consumers who live in regions where rents are high and/or growing rapidly. It is currently working to expand its presence in the Sunbelt region, where population growth has been strong in recent years.

UDR is another large apartment landlord. It has long focused on having a diversified portfolio. It currently has exposure to both coastal markets and the Sunbelt, where it has operated for many years.

However, there's another layer of diversification here, because UDR owns both A- and B-quality assets. In hard times, B-grade apartments can be attractive to tenants because they generally have lower rents.

AvalonBay's dividend hasn't been increased every year, but it has generally trended higher over time. UDR's dividend has been increased annually for 16 consecutive years. Right now, AvalonBay's dividend yield is 3.6%, and UDR's is 4.2%. Both are well above the yield you'd collect from the S&P 500 today.

And with multifamily construction starts down, both UDR and AvalonBay are likely to enter a stretch where they benefit from an increased ability to push through rental increases. Thus, their dividends are likely in a very strong position to be maintained or increased.

In times of uncertainty, stick with necessities

When the market is in a state of flux, with the words "correction" and "bear market" making the rounds, investors often buy consumer staples stocks. The reason is that consumer staples are necessities.

That same logic applies to apartment REITs like AvalonBay and UDR -- only these two REITs come with some added benefits, including high yields and a positive business backdrop for their unique property focus.

Should you invest $1,000 in UDR right now?

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Reuben Gregg Brewer has no position in any of the stocks mentioned. The Motley Fool recommends AvalonBay Communities. The Motley Fool has a disclosure policy.