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Do Real Estate ETFs Know Something We Don't?: Hulbert

Real-estate exchange traded funds (ETFs) have been on a tear recently, so don't be surprised if the outlook for the sector is brighter than many believe, Mark Hulbert, Marketwatch senior columnist and editor at Hulbert Financial Digest, told CNBC Monday.

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"Exchange traded funds that are pegged to the real-estate sector have recently hit 52-week highs, so at least [it's] something that the market is seeing that perhaps the rest of us aren't," Hulbert said, in reference to a study by Sound Advice.

Among the real-estate ETFs trading near their 52-week highs are iShares Dow Jones U.S. Real Estate Index Fund , Vanguard REIT Index and SPDR Dow Jones REIT .

The Sound Advice data focused on home foreclosure rates, Hulbert said. Although foreclosures have been declining since late last year, "a lot of people have dismissed that because, of course, there is a lot of legal and paperwork delays that they think are causing a backlog and the decline is artificial," he said.

Hulbert said Sound Advice also noted that there has been a decline in the number of new default filings, and that is harder to dismiss than foreclosure rates. "Of course an eventual foreclosure has to begin with a default, so if the number of defaults are coming down, perhaps there is some basis," he said. "Maybe that's what the markets are looking at in these ETFs."

"Trying to pick a bottom, especially a bottom of a market that has been so decimated as housing is a very risky thing." Hulbert said, though he noted that Sound Advice "has a very good record—it is a contrarian service."

Watch: Recent interview with Hulbert.

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Disclosure information was not available for Mark Hulbert or his company.