During the height of the housing market collapse, the media tried to convince individuals and investors alike that the American dream of home ownership was dead. As the home building stocks plunged, investors became enamored with the multifamily REIT sector, convinced everybody going forward would be living in apartments. The apartment REIT stocks soared as a result.

Nearly two years ago, multifamily REITs traded at an all-time high valuation spread to the REIT industry on an adjusted funds from operation (AFFO) basis. That relationship has completely reversed, with multifamily AFFO multiples below the REIT industry average for the first time since 2000. That reversal is not lost on the REIT analysts at UBS A.G. (NYSE: UBS). In a recent report, UBS reiterated a sector Overweight rating on multifamily REITS and has a list of stocks to buy.

Apartment Investment & Management Co. (NYSE: AIV) leads off the UBS list of stocks to buy. It is a major apartment company that has refocused on coastal and job-growth markets. Its portfolio of almost 200 properties is concentrated in 20 markets. The UBS price target is $33. The Thomson/First Call estimate is $31.53. Investors are paid a 3.20% dividend. It is important to remember REIT distributions can contain capital gains and return of principal.

Avalonbay Communities Inc. (NYSE: AVB) is best known for owning and building high-end apartment buildings in high barrier coastal markets. It owns or has an interest in more than 200 apartment communities in nine states and Washington, D.C. The UBS price objective is $142. The consensus estimate for the stock is at $141.50. Investors receive a 3.30% dividend.

BRE Properties Inc. (NYSE: BRE) focuses on the development of multifamily apartment communities in metropolitan markets within California and in the Seattle region. UBS has a price target of $53, but the consensus is at $51. Shareholders are paid a 3.20% dividend.

Camden Property Trust (NYSE: CPT) is a stock to buy. Since 2010, operating cash flow has increased more than 30%. The UBS target for the stock was raised from $74 to $78. The consensus estimate is $75. Investors receive a 3.50% dividend.

Colonial Properties Trust (NYSE: CLP) delivered a first-quarter profit, met Wall Street’s expectations and beat the revenue estimate. UBS has a $25 target, and the consensus is in line at $25. Shareholders are paid a 3.70% dividend.

Equity Residential (NYSE: EQR) is a mega-cap REIT to buy. It has shifted its portfolio toward coastal markets with high barriers to entry, too. It owns more than 400 properties across 14 states. UBS has a $63 target. The consensus target is $62.50. The stock pays a 2.90% dividend.

UDR Inc. (NYSE: UDR) has undergone a major transformation over the past decade. It once focused on upgrading older properties in second-tier markets. A new CEO shifted its focus toward high-barrier, urban markets. UBS has a $27 target, while the consensus is at $26. Investors are paid a 3.90% dividend.

Essex Property Trust Inc. (NYSE: ESS) is a UBS stock to buy. With properties across California and Washington state, its earnings have been solid. UBS has a $160 target. The consensus estimate is higher at $166.50. The stock pays a 3.10% dividend.

One common thread among the UBS stocks to buy is dividends of more than 3%. With the 30-year treasury trading at 2.99%, and no end in sight for the quantitative easing bond buying, rates could stay low well into 2014. Good valuation and a solid dividend makes sense for investors seeking growth and income.

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