If in 2000 someone were to say. I want an investment that pays during good times and bad. Never cuts the dividend. Raises the dividend on a regular basis. Is fair to the shareholders. No accounting scandles.
RETs would have been the answer.
When you look at what a T-bill pays and look at what a REIT pays you have to ask yourself. What does the world know? The problem is it has become mainstream to bash one sector after the other. People just can't believe that Real Estate can be refuge of safety. But commercial property values are based on income. Houses are like stamps. It is a preceived value.
Today the apartments are still filled. The rent is being paid. nobody is building new hows for the tenents to move into. So why on earth wouldn't this be a safe bet in trouble times?
Bottom line is if the REITs can keep shelling out the dividend chack. When these companies start to grow earnings the stocks are gowing to explode the day the REITs can go back to raising dividends.
It's hard to say when the traders will stop trading these stocks down. But it is easy to predict that the REITs will continue to pay back fairly to investors. And on that note there is no reason to ever sell, which by diffination means they are fundementally under priced.
$11.67 (01/04/09)
