This column was originally published on RealMoney on Nov. 17 at 8:55 a.m. EST. It's being republished as a bonus for TheStreet.com readers."High-end homes always hold up." There's a bogus shibboleth. However, the data about how expensive homes are really selling right now are scarce, and as many commentators have noted, you can't get a straight answer out of the realty business.
AREP has been marketing for sale portions of its net lease portfolio, and accordingly, carries such properties as "discontinued operations" in its financial statements. For the three months ended September 30, 2005, AREP sold no properties. For the three months ended September 30, 2004, AREP sold 12 properties for proceeds of $13.9 million and recorded a gain from discontinued operations of $9.3 million.At first, I thought that perhaps the company simply might not have put any lots up for sale. But my source close to the company says actually, the company just isn't getting any new sales -- particularly in the $2 million range, where AREP has homes for sale in Westchester County. "It almost stopped cold" this quarter, my source tells me. Remember, it's been the prediction of Capital Growth Management's Ken Heebner that the expensive home cohort is the place where the most damage might be done, and where the most speculation has occurred. This little brief from AREP may be the tell that Heebner, who nailed the long leg up in the group for his fund family, may be well on his way to nailing the downside, too. Random musings: Have some fun,
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