The continued growth of the equity REIT market depends critically on investors's belief that the stock market provides fair and accurate valuations of real estate. An index of real estate stocks traded on the New York and American stock exchanges reflects changes in real estate market fundamentals in a more timely fashion than a widely used appraisal-based system. The index includes equity real estate investment trusts (REITs), real estate operating companies not organized in trust form, land subdividers and commercial developers, and general contractors. A statistical examination of the relation between the stock-based and appraisal-based series finds that the lagged returns of the real estate stocks help explain the behavior of the current-period appraisal series. The stock market apparently impounds information about changes in real estate values in a more timely manner than appraisal-based series constrained by infrequent property appraisals.