Reits fundamentals remain appealing

After a five-year boom in property, particularly residential property, in the US, recent statistics suggest the market may have passed its peak. Property companies in the US have traditionally traded at a discount to their net asset value but, after having eclipsed most equities in recent years (with an annualised 19.3% gain in dollars in the five years to end-March), US Reit funds were recently trading above NAV. In this context, the pullback in the performance of Reit funds in the first quarter of 2005 was not entirely unexpected. And with increased sensitivity to interest rate fluctuat...