Reuters has reported that fair value accounting rules that would require real estate companies to report land and buildings held for investment may become the new standard.

According to Reuters, the Financial Accounting Standards Board has tentatively decided to require fair value accounting for investment property. Fair value accounting practices measure assets by their market worth rather than historical cost. This could impact companies such as real estate investment trusts if they value their holdings based on historic costs, which typically had been counted upon to appreciate each year. However, FASB is examining whether current accounting practices create an unrealistic view of present real estate values given the current state of the economy.