Third quarter improvements reported by Home Properties.

Home Properties released financial results for the third quarter and nine months of 2004.

"Rental rates, total revenues and net operating income continued to improve in the third quarter, even though the occupancy level at Home Properties' apartment communities continues to be challenged by the lack of meaningful job growth and low home mortgage rates," said Edward J. Pettinella, President and CEO.

"Year to date, we are pleased that occupancy and average monthly rents have increased over last year."

Earnings per share ("EPS") for the quarter ended September 30, 2004 was $0.09 compared to $0.30 for the quarter ended September 30, 2003, a decrease of 69.9%, primarily attributable to the significant loss on disposition of property that was recognized in 2004 as compared to 2003. This loss related to the sale of the affordable limited partnerships.

EPS for the three months ended September 30, 2004 for income from continuing operations was $0.30 compared to $0.28 for the year-ago period.

EPS for the nine months ended September 30, 2004 was $0.49 compared to $0.75 for the nine months ended September 30, 2003, or a decrease of 34.8%, primarily attributable to the loss on disposition of property as described above.

However, income from continuing operations for the nine months ended September 30, 2004 was $0.74 compared to $0.71 for the nine months ended September 30, 2003.

For the quarter ended September 30, 2004, Funds From Operations ("FFO") was $28.3 million, or $0.56 per share, as compared to $37.4 million, or $0.78 per share, for the quarter ended September 30, 2003. These results equated to a 24.4% decrease in total FFO from the comparable prior-year period and a 27.8% decrease on a per-share basis.

Results for the 2004 third quarter include a combined loss on sale of property of $9.9 million, or $.20 per share, related to the disposal of affordable limited partnerships.

Net operating income ("NOI") increased by 1.9% from the third quarter of 2003. Property level operating expenses increased by 4.1% for the quarter, primarily due to increases in repairs and maintenance, personnel, property insurance and real estate taxes, offset in part by a reduction in advertising and office and telephone.

During the third quarter, the Company announced the acquisition of three apartment communities in two unrelated transactions. The acquisitions consisted of two communities in Florida with 836 units and one community in northern New Jersey with 372 units. The total purchase price of $106.8 million, including closing costs, equated to an average of $88,400 per apartment.

For 2005, the Company expects FFO per share between $2.83 and $2.97.