Housing Bubble and Real Estate Market Tracker

by: Judy Weil

Here's our summary of articles and data points on the housing market. It's part of Seeking Alpha's coverage of the real estate market and homebuilder stocks. Like all other topics and stock coverage from Seeking Alpha, you can have this sent to your Blackberry or desktop email by signing up for our no-spam free email subscription service.

Quote of the Day- "From the House's Mouth"

"I feel that you and your staff may not fully understand the differences between the mortgage-backed securities [MBS] issued by the GSEs [gov't sponsored enterprises] and those issued by other entities." – James B. Lockhart, director of the Office of Federal Housing Enterprise Oversight wrote angrily to NY attorney general Andrew Cuomo after he announced subpoenas given to Freddie Mac, Fannie Mae and Washington Mutual. Cuomo suspects collusion between lenders and appraisers to inflate house prices. Cuomo set off the potential "turf war" by not informing Lockhart of the investigation before going public. (Seeking Alpha, Nov. 8th)

Real Estate Sales and House Prices

  • October Home Sales Dip; Condo Prices Up (Myrtle Beach Online, Nov. 8th): "Coastal Carolinas Association of Realtors: About 626 homes and condos were sold, down 34% from October 2006. The statistics represent Horry and Georgetown counties and pockets of Brunswick County, N.C... Condos spent fewer days on the market compared with October 2006, but more days than homes did. Homes spent 166 days on the market, up from 150, and condos spent 295 days on the market, down from 324. Median prices for condos rose 8% to $226,763... While median home prices rose slowly between Q3'06 and 2007, October prices fell 3% compared with October 2006 to $204,750."

  • Sales Of Pre-Owned North Texas Homes Fell About 13 Percent In October (Dallas Morning News, Nov. 8th): "North Texas Real Estate Information System and Texas A&M University's Real Estate Center: Pre-owned North Texas home sales fell 13% in October vs. October 2006, with 6,378 homes sold... Pre-owned home sales are down about 7% year-to-date in 2007 from the same period in 2006... The median price of homes sold in October was $146,000 – up 2% from a year ago... [In] October, there was about 6.4 months' supply of homes on the market in North Texas... On average, it took 75 days to sell houses in October. There are about 48,000 pre-owned single-family NT homes [and 4,250 condos] for sale."

  • Slumping in Seattle (Columbian.com, Nov. 8th): "For the first time since the early 1990s, the median price of homes sold in King County declined last month compared with a year ago, The Seattle Times reports. The Seattle area's median price in October was $387,500, down 1% from $391,300 a year ago. The number of homes and condos on the market has jumped to 14,240, up 40% from 2006, according to figures gathered from the Northwest Multiple Listing Service."

  • New York City Real Estate Market Immune To Malaise; Home Values Rise Again (Int'l Herald Tribune, Nov. 7th): "Real Estate Board of New York: The average sales price for a New York dwelling climbed to $782,000 (€531,178) in Q3'07, an increase of 20% over Q3'06. Prices were highest in Manhattan, where the average home sold for $1.33 million, or around $1,176/sf. The cost of a home went up in every borough except Staten Island, which saw a 2.8% drop. The price hikes stood in sharp contrast to what has been happening in the rest of the country, and even the New York City metropolitan region as a whole."

Affordability Problems

  • As A 'College Town,' Honolulu Is Pricey (Pacific Business News, Nov. 6th): "Coldwell Banker Real Estate study: Honolulu ranks among the priciest college towns...With an average home price of $843,750, Honolulu, home to the University of Hawaii-Manoa, ranked seventh on the list of the 10 most expensive college markets. Palo Alto, Calif., home to Stanford University, topped the list, with an average home price of $1.7 million. Next on the list were Chestnut Hill, Mass., where Boston College is located, and Los Angeles, home to the University of Southern California and the University of California-Los Angeles. Muncie, Ind., home to Ball State University, was most affordable, with an average home price of $150,000."

Real Estate Investment and Sentiment

  • GE Real Estate Launches Green Initiative (CNN Money, Nov. 7th): "GE Real Estate today announced a new initiative to green its real estate investment business, a global business that generates more than $30 billion in annual transaction volume across 28 countries. Sustainability will be embedded into its existing investment processes, from origination of investments to underwriting, due diligence and asset management in an effort to improve the environmental performance of assets, to positively impact the health of tenants, and to improve the value of the properties."

Mortgages and Real Estate Lending

  • Price Is (Not) Right: Appraisals Now Sink Sales (Boston Herald, Nov. 8th): "Desperate homeowners trying to unload properties face a new obstacle: Appraisers who are increasingly coming in with lower-than-expected estimates of home values. The low estimates are leading to last-minute nixing of some sale deals and putting even more downward pressure on home prices in a tight housing market. Home appraisers, whose estimates are key to the issuance of mortgages, say market forces are ultimately the cause of falling home values. But they acknowledge that loan underwriters... are now more cautious about depreciating home prices... underwriters don’t want to get stuck holding loans for homes whose values will [later fall.]"

  • Applications Decrease Slightly (Originator Times, Nov. 7th): "The Mortgage Bankers Association Weekly Mortgage Applications Survey for the week ending November 2, 2007: Mortgage loan application volume was 670.6, a decrease of 1.6% on a seasonally adjusted basis from 681.7 one week earlier... The Refinance Index decreased 3.2% to 2176.1 from 2249.0 the previous week and the seasonally adjusted Purchase Index decreased to 412.7 from 412.9 one week earlier... The seasonally adjusted Conventional Index decreased 2.3% to 960.0 from 982.2 the previous week, and the seasonally adjusted Government Index increased 4% to 188.0 from 180.7 the previous week."

  • Mortgage Brokers Fear 'Extinction' If New Bill Passes (Mortgage 101, Nov. 7th): "National Association of Mortgage Brokers: "Mortgage brokers are facing extinction. The U.S. House of Representatives is considering a bill (H.R. 3915) that will fundamentally change the way we are paid, outlaw YSP, and legislate underwriting guidelines into law. Additionally, we fear that all subprime lending will cease to exist due to excessive lender liability... A controversial section of the legislation attaches limited liability to secondary market securitizers who package and sell interest in home mortgage loans outside of these standards. However, individual investors in these securities would not be liable."

  • Brokers Slam AG (Boston Herald, Nov. 7th) Massachusetts: "Mortgage brokers are in an uproar over Attorney General Martha Coakley’s proposed regulations for the industry, saying her plans would gut how they’re paid and potentially lead to thousands of job losses. The head of the Massachusetts Mortgage Bankers Association will meet with officials from Coakley’s office this Friday in an effort to head off a potential confrontation. The group, which represents both mortgage brokers and lenders, is threatening legal action to block Coakley’s new rules, which are set to take effect Nov. 15."

  • Should You Buy Indymac On The Capitulation This Morning? (FIG Trader in Seeking Alpha, Nov. 7th): "Indymac Bancorp (IMB), has substantial upside, once the short covering gathers speed... One dividend cut is priced in, and even if they lost money in Q4 and cut the whole dividend, the stock will be much higher in 2008... The rolling capitulation sector-wide among financials is probably 80% done, and perhaps even more so among the mid and small caps. The near term upside is awesome, as seen in the bond insurers since the lows Monday. SEC filings for Q3 are due next week [and] most of the bad news... is priced in. The next big move is up (through Q4 earnings)."

Global Subprime Fallout or Global Housing Slump?

  • UK Housing Market Hit Unevenly By Credit Crunch (Reuters, Nov. 8th): "Credit information firm Experian: Britain's housing market will become a direct casualty of the credit crunch with the pain felt unevenly across the regions. Experian predicted house prices over the next two years would record the lowest annual increases since the mid-1990s, while repossessions would reach 15-year highs. Experian: "Modest declines in house prices are predicted in the South East and the East of England, while values fall much more sharply in the South West. By contrast, Greater London, where overvaluation is less severe than in the rest of the south, has the UK's strongest short-term outlook after Scotland."

  • HSBC Ends Sales of Mortgage-Backed Securities in U.S. (Bloomberg, Nov. 8th): "HSBC Holdings Plc, the biggest U.K. bank, said it stopped sales and trading of mortgage-backed securities in the U.S. after the collapse of the subprime market forced it to close down two origination units. About 120 securities jobs will be cut globally, including 20 in the U.K... HSBC has also ceased investment-banking coverage of healthcare in the U.S.... The five-month rout in the $6 trillion market for U.S. home-loan bonds has eroded the value of assets including securities backed by subprime loans and debt guaranteed by government-linked organizations such as Fannie Mae.

  • China Limits Foreign Investment In Real Estate, Other Key Areas (Int'l Herald Tribune, Nov. 7th): "China's economic planning agency has issued restrictions on foreign investment in real estate and other industries... Many of the restrictions match a list issued by the NDRC in 2004... suggesting that some [reiterated rules], such as limits on foreign investment in real estate, were not adequately enforced... Apart from the ban on investment in golf courses and in real estate agencies, the list matches current regulations. Foreign direct investment in China rose almost 11% in January-September over the year before to US$47.2 billion. Of that total, foreign investment in property development accounted for 42.3B yuan (US$5.7B)."

Subprime Fallout

  • Morgan Stanley Marks Down $3.7 Billion, Cuts Outlook (Bloomberg, Nov. 8th): "Morgan Stanley joined Merrill Lynch & Co. and Citigroup Inc. in booking losses on subprime mortgage- related assets and said the outlook for credit markets is bleaker than in September. The second-biggest U.S. securities firm by market value after Goldman Sachs Group Inc. said it lost $3.7 billion in the two months through Oct. 31. Prices for securities linked with home loans to risky borrowers sank further than traders expected, cutting fourth-quarter earnings by $2.5B. The figure may change by the end of the month."

  • Contemplating Life Without Guarantors (David Merkel in Seeking Alpha, Nov. 8th): "Financial guarantors have had a tendency to reinsure each other. MBIA (NYSE:MBI) reinsures Ambac, and vice-versa. RAM Holdings (OTC:RAMR) reinsures all of them. The guarantors provide a type of “branding” to obscure borrowers in the bond market. Rather than put forth a costly effort to be known, it is cheaper to get the bonds wrapped by a well-known guarantor; not only does it increase perceived creditworthiness, it increases liquidity... [Carefully] evaluate guaranteed investments both ways. i.e., ABC corp guaranteed by GUAR corp, or GUAR debt secured by an interest in ABC corp. This is a situation where simplicity is rewarded."

  • Stock Market Mayhem And Bush's Moral Swamp (Online Journal, Nov. 8th): "Short-term" asset-backed commercial paper has shriveled by $275 billion in the last 10 weeks leaving the banks with gargantuan liabilities... Bloomberg: "Banks shut out of the market for short-term loans are finding salvation in a Great Depression-era government lending program... Countrywide Financial Corp. (CFC), Washington Mutual Inc. (NYSE:WM), Hudson City Bancorp Inc. (NASDAQ:HCBK) and hundreds of other lenders borrowed a record $163B from the 12 Federal Home Loan Banks in August-September as interest rates on asset-backed commercial paper rose as high as 5.6%. The government-sponsored companies were able to make loans at about 4.9%, saving the private banks about $1B in annual interest."

  • AIG Profit FallS 27 Percent (WJLA/ABC News, Nov. 8th): "Losses in AIG's investment portfolio, credit-swap portfolio and mortgage-insurance business added up to about $1.4 billion, and caused net income to fall by 27% compared with last year's Q3... Back in August, AIG called exposure to subprime debt "minimal." AIG's $872.3 billion-investment portfolio lost $864 million, its credit-swap portfolio lost $352 million, and its mortgage-insurance business lost $215 million... AIG's investment portfolio does include some collateralized debt obligations... But the exposure is smaller than that of banks such as Citigroup Inc. and Merrill Lynch & Co., which have written down big losses on their CDO investments."

  • Jim Cramer's Mad Money In-Depth, 11/7/07: The Gisele-Cuomo Selloff (Miriam Metzinger in Seeking Alpha, Nov. 8th): "Andrew Cuomo, the New York Attorney General, issued subpoenas to FNM and FRE to give information on loans they purchased from WM... Concerning Cuomo’s inquiry, Cramer said, “There's only one way out of the mortgage morass. We need to see lower down payments." Cramer is concerned government regulators may scare lenders out of lending. Cramer concluded the stories bringing down the market are temporary and urged investors not to panic.

  • SIV Managers Don't Expect Model to Survive Slump (Bloomberg, Nov. 8th): "Managers of structured investment vehicles don't expect their business model to survive as the value of assets shrinks and the companies struggle to borrow, Moody's Investors Service analysts said today. "Some managers hold the view that the short-term debt market for SIV paper has been permanently disrupted and the SIV model will not survive in its current form,'' Paul Kerlogue, a senior credit officer at Moody's in London, said on a conference call. The net asset value of SIVs has fallen to 71% of initial capital from 102% in June."

  • Fannie, Freddie, WaMu Tumble on Expanded Probe (Seeking Alpha, Nov. 7th): "Government-sponsored mortgage lenders Fannie Mae (FNM) and Freddie Mac (FRE) received subpoenas from NY Attorney General Andrew Cuomo concerning their due diligence practices and about loans they bought from Washington Mutual and other banks. Cuomo says he uncovered a "pattern of collusion" between lenders and appraisers [to] inflate appraisal values. If decided that they own or guarantee mortgages with inflated appraisals, company policy dictates that the lenders buy back the loans. Last week Cuomo sued the appraisal unit of First American Corp., the number-one U.S. title insurer, for inflating home values under pressure from WaMu... WaMu is Fannie's third-largest loan provider, selling it $24.7B in 2007, and $7.8B to Freddie in 2007."

Foreclosure Data

  • Closure Call (NY Post, Nov. 8th): "RealtyTrac: In Queens, foreclosures were up nearly 70% in Q3'07 vs. Q3'06... Foreclosure tracking site PropertyShark.com: "There are more people talking, more people investigating..." Many foreclosure hunters... are waiting for the moment when banks get desperate and slash the prices they are willing to accept. Greg Fonti, an auction referee... pointed to the late 1980s as historical precedent: "The last time this happened was back in '88... The banks were closing and were getting pressured by FDIC regulators to move these properties off their books. Will the banks start selling them for cheaper? Yes, I have no doubt."

Global Opportunities

  • Time to Buy American (Canada Globe and Mail, Nov. 8th): "The U.S. is a big, screaming bargain now that our Canadian dollar is on the rampage... While Canadian housing prices are inexhaustibly buoyant, the U.S. market is falling hard. The average resale price tumbled 10% across the country in September, and in balmy Phoenix, third-quarter sales of single-family homes were off 23%... Arizona Republic newspaper: One-third of homes on sale in the Phoenix area are empty, many of them investor-owned who [can't] sell [or] find renters... You can score yourself a nice vacation property in Arizona and help out an embattled American real estate speculator at the same time."

Macro Impact, And Will The Housing Slump Cause A Recession?

  • Consumers Showing Some Financial Fatigue Outside Mortgages Causing Concern (Memphis Daily News, Nov. 8th): "The malaise in the mortgage market is starting to spread to credit-card and auto loans... Many of the nation's big banks and credit-card companies have begun acknowledging... a shift in consumer behavior, including more people unable pay off their debts... Citigroup said last month that it had seen evidence of cardholders increasing the balance on their cards or some for the first time are using the card to take cash advances... Capital One, on Oct. 18, cited higher delinquency rates in its credit card and auto loan divisions... and boosted 2008 credit losses estimates to potentially above $5 billion."

  • U.S. Homeowners Feeling The Pinch Of Lost Equity (Int'l Herald Tribune, Nov. 7th): "Economist James Kennedy and former Fed chairman Alan Greenspan: From 2004-2006, Americans pulled about $840 billion a year out of residential real estate, via sales, home equity lines of credit and refinanced mortgages. [This] financed $310B a year in personal consumption from 2004-2006. In H1'07, equity withdrawals were down 15% nationally compared with the average for the last three years. Consumption supported by such funds plunged nearly one-fourth. Moody's Mark Zandi: Only a year ago, money taken out of houses was still more than 9% of the nation's disposable income... By this fall, it had dropped to about 5%, a $350B difference."

Homebuilders, Housing Stocks and Housing-Related Stocks

  • Toll Brothers' Q4 Revenue Forecast Better Than Expected (Steven Towns in Seeking Alpha, Nov. 8th): "Luxury homebuilder Toll Brothers (NYSE:TOL) preliminary fourth-quarter financial results: Revenues are expected to fall 36% to $1.17B, compared to analysts' average estimate of $1.13B. Backlog also dropped 36% to $2.85B. Toll signed 32% fewer contracts (total 1,073) worth 38% less (total $693.7B) compared to Q4'06. Toll reported 417 cancellations worth $328.5M, versus 585 valued at $412.3M last year. Toll expects $450 million in land writedowns. Average price per unit for contracts signed during Q4 was off 3.1% to $646,000... The company is scheduled to report Q4 results on Dec. 6."

  • TOUSA Hires Advisor to Explore 'Restructuring' (Seeking Alpha, Nov. 8th): "Homebuilder Technical Olympic USA [TOUSA] said Wednesday it has retained the services of Kroll Zolfo Cooper LLC to "explore its long-term business plan and restructuring options." On Tuesday TOUSA (TOA) said it would delay reporting Q3 results. In early October, TOUSA hired financial advisors Lazard Freres & Co to help restructure its $1.6 billion debt. In mid-October, a creditor for more than $1B in TOUSA senior debt hired a law firm purportedly to assess the possibility of a bankruptcy filing. In late October, TOUSA amended two loan agreements to restructure its mounting debts, and forecast further, significant Q3 land impairment charges [after] Q2 losses of $132 million, and $66M in Q1. Fitch Ratings recently downgraded the company's issuer default rating."

  • The Real Deal on the Homebuilders (Reggie Middleton in Seeking Alpha, Nov. 8th): "For those builders who survive the bust there will be a prolonged lull in building then a return to the mean, which will be a staid, cyclical 12%-16% GROSS margin and low single digit net margins - no more multi-billion+ dollar quarters... Ryland (NYSE:RYL) has been trying to sell land as well as houses. The problem is they have paid so much for the land with so much debt that [no one will] buy... Ryland will need 53,974 closings to pay down their existing debt at their current pace or 24 quarters. I foresee them having 8 quarters to get their act together."

  • Citi Lowers Estimates For Home Depot, Lowe's On Housing Weakness (FP Trading Desk in Seeking Alpha, Nov. 8th): "Analyst Deborah Weinswig of Citigroup lowered her estimates on Home Depot Inc. (NYSE:HD) and Lowe’s Cos. (NYSE:LOW) when data showed new residential home sales fell 23.3% in September year over year after falling 27.2% in August and 17.7% in July. The analyst lowered her Q3 per share earnings estimate on HD to $0.60 from $0.63 and to $0.47 from $0.49 in Q4. She also lowered her target price on the shares to $33 from $35. She lowered her Lowe’s Q3 estimate to $0.41/share from $0.43 and in Q4 to $0.37 from $0.39. She lowered her target price on Lowe’s to $31 from $36."

  • A Question Of Home Improvement (Jack Miller in Seeking Alpha, Nov. 7th): "On Monday, one of the big investment banks probably called a bottom on Home Depot (HD) when it downgraded the stock... Home improvement projects tend to flourish during slow home building cycles... I have great respect for Bill Miller, manager of billions of dollars of funds at Legg Mason... His record of beating the S&P by better than 2.5% for 15 years in a row speaks volumes. Bill says it is time to buy financial stocks and home builders. Because Bill builds huge positions, he must jump in early to accumulate all the shares he wants."

  • WCI Wields the Ax (Forbes, Nov. 7th): "WCI Communities (WCI) announced Wednesday it was slashing 27% of its workforce and streamlining operations. As part of WCIs cost-saving initiative, financier Carl Icahn and five other board members... forfeited compensation from Oct. 5 through the balance of calendar year 2007 and all of 2008. WCI also said that it will cut 575 employees, reducing its workforce to 2,100 to save $46 million in salaries and benefits annually. The company peaked at 3,889 employees in mid 2006. WCI named David Fry to the post of chief operating officer. The costs associated with the restructuring are approximately $5.4M."

  • Orleans Swings To Loss As Housing Slump Continues (Philadelphia Business Journal, Nov. 7th): "Orleans Homebuilders Inc. (OHB)... reported a 26% drop in FQ1 revenue and a $2.1 million loss, or $0.11/share, compared with a profit of $3.9M, or $0.21/share, for FQ1'07. The company attributed the loss to charges related to inventory impairments, write-offs for abandoned projects and other pre-acquisition costs as well as $3.1M in severance fees. Revenues dropped to $122.9M from $165M in spite of new orders rising 22%. Orleans said its cancellation rate slowed, falling to 21% from 36% a year ago. The company said the housing market continues to be unfavorable and demand for housing has slowed."

  • First Existing Carpet Manufacturing Facility Earns LEED (Interior Design, Nov. 6th): "Bentley Prince Street, the largest commercial carpet manufacturer in California [a division of Interface, Inc. (IFSIA)- Ed.]... is the first carpet manufacturing facility to earn LEED Silver from the U.S. Green Building Council and the first manufacturing facility... to land the LEED for Existing Buildings v2.0 label. Each year, seven million yards of carpet is produced [at] the mill, which performs on 100% renewable electrical energy and has one of the first privately-funded photo voltaic solar arrays in the field. Bentley Prince Street's efforts have reduced landfill waste by 95%, water consumption by 71%, and overall energy use by 57%."

  • Lifetime Brands Q3 Results Miss Street View, Shrs Slide (Reuters, Nov. 6th): "Lifetime Brands Inc (NASDAQ:LCUT), which designs and markets kitchenware and home decor, posted quarterly profit below market view and cut its 2007 outlook, as a squeeze in consumer spending led to lower orders from retailers. In Q3, the company earned $6.8 million, or $0.47/share, up from $6.7M, or $0.45/share, last year. Total sales rose modestly to $143.5M from $141.7M in the year-ago period. Analysts expected earnings of $0.66/share, before items, on revenue of $162.7M. Recent economic uncertainty and high energy costs hurt consumer spending in the quarter, prompting most retailers to take a very conservative stance on their inventory levels."

  • Black & Decker VP Exercises Options (CNN Money, Nov. 6th): "A vice president of power-tool maker Black & Decker (BDK) Corp. exercised options for 12,875 shares of common stock, according to a SEC filing. In a Form 4 filed Monday with the SEC, Stephen Reeves reported he exercised the options Friday for $42.78 apiece and then sold all 12,875 shares on the same day for $86.78 to $87.29 apiece. Insiders file Form 4s with the SEC to report transactions in their companies' shares. Open market purchases and sales must be reported within two business days of the transaction."

Commercial Real Estate and Real Estate Investment Trusts (REITs)

  • Downtown Brooklyn Finally Arrives (New York Sun, Nov. 8th): "There is now more than $9 billion worth of development under way in downtown Brooklyn, including millions of square feet of office and retail space and the arrival of 35,000 residents over the next five years. Last week, the Downtown Brooklyn Development Partnership unveiled renderings of the proposed redevelopment of downtown Brooklyn that would include increased residential and commercial space, as well as the new Willoughby Square Park."

  • Lending Sentiment Drops Dramatically (Michael Shedlock in Seeking Alpha, Nov. 7th): "All trends end. More importantly, they all end at the precise moment they do the most damage. It simply must be that way. Trends run until they exhaust themselves. Housing peaked with the cover of Time Magazine going "gaga" over real estate. Who was left to buy? The same applies to commercial real estate, the percentage makeup of financial stocks in the S&P 500, and even consumer spending habits. Secular changes are now underway in all of those areas. Those who do not adapt to the sentiment changes at hand will simply be left in the dust."

  • Commercial Pause Might Spur Public Projects (Wall St. Journal, Nov. 7th): "Tucson's slowing economy is likely to curtail some planned commercial-real-estate construction, but the downturn may enable Arizona's second-largest metropolitan area to shift its attention to larger, public projects. The slowdown is expected even as the region's commercial real estate ranks among the nation's healthiest. Tucson's commercial real-estate market tied with two other markets for the sixth-strongest score out of 59 U.S. markets surveyed by Moody's Investors Service in a report based on second-quarter data. By contrast, larger neighbor Phoenix tied with two other markets for the fourth-weakest overall score, in part because of a glut of suburban office construction."

  • Shopping Center REITs See Gains in Third Quarter (Retail Traffic, Nov. 7th): "Amid the slowing economy, flagging housing market and unfolding credit crunch, neighborhood and community center REITs posted lackluster Q3 results, suffering as consumers reined in spending... The sector's performance was impacted by weak same-store growth... In September, same-store sales inched up just 1.7% --below the average gain of 2.3% to date in 2007. For October, things don't look much brighter with ICSC forecasting growth of 2%. And for the last two months of the year the trade group says same-store sales will grow 2.5%. Home goods, furniture and dollar stores have come under particular scrutiny, because they are more susceptible to slowdowns in residential construction."

  • Inland Real Estate's 3Q Results Decline (Chron.com, Nov. 7th): "Retail REIT Inland Real Estate Corp. Q3 results slipped slightly on higher expenses... Funds from operations, [FFO], fell to $22.8 million, or $0.35/share in Q3, from $23.2M, or $0.34/share, in the year-ago period. The number of outstanding shares decreased from the previous year. The REIT attributed the decline in FFO to an increase in interest expense and operating expenses for its properties. On average, analysts expected $0.35/share. FFO, which adds such items as amortization and depreciation back to net income, is considered a key measure of REIT strength... The company reiterated its full-year FFO guidance of $1.40-$1.43/share."

  • Health Care REIT's 3Q Net Rises; Adjusted FFO In Line With Consensus View (Forbes, Nov. 6th): "Health Care REIT Inc. late Tuesday reported third-quarter net income of $30.8 million or $0.30/share, up from $26.8M, or $0.34/share, in the year-ago period. The REIT posted adjusted funds from operations of $0.79 versus $0.73 last year, as revenue rose to $125.1M from $78.8M. Analysts were expecting, on average, a per-share profit of $0.35 and FFO of $0.79. The company narrowed its 2007 earnings forecast to a range of $1.27-$1.29/share from its earlier view of $1.27-$1.33/share, and narrowed its adjusted FFO outlook to a range of $3.11-$3.13/share from $3.09-$3.15 a share."

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