FORM 10-Q

                       SECURITIES AND EXCHANGE COMMISSION

                             Washington, D.C. 20549

(Mark One)

x QUARTERLY  REPORT  PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES  EXCHANGE
ACT OF 1934

For the quarterly period ended September 30, 1999

                                       OR

o TRANSITION  REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES  EXCHANGE
ACT OF 1934

For the transition period from ________ to ___________

Commission file number: 000-23677


                               NEWMARK HOMES CORP.
             (Exact name of Registrant as specified in its charter)

Nevada                                                       76-0460831
(State or other jurisdiction of                              (I.R.S. Employer
incorporation or organization)                               Identification No.)

1200 Soldiers Field Drive
Sugar Land, TX    77479
(Address of principal executive offices)  (Zip code)

                                  281-243-0100
               (Registrant's telephone number including area code)

                                 Not applicable
(Former  name,  former  address,  and former  fiscal year, if changed since last
report)

         Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the  Securities  Exchange  Act of
1934  during  the  preceding  12 months  (or for such  shorter  period  that the
registrant was required to file such reports),  and (2) has been subject to such
filing requirements for the past 90 days. Yes X No ____

              APPLICABLE ONLY TO REGISTRANTS INVOLVED IN BANKRUPTCY
                  PROCEEDINGS DURING THE PRECEDING FIVE YEARS:

         Indicate by check mark whether the  registrant  has filed all documents
and reports  required  to be filed by Section 12, 13 or 15(d) of the  Securities
Exchange Act of 1934 subsequent to the  distribution of securities  under a plan
confirmed by a court.
Yes ____ No ____

                   (APPLICABLE ONLY TO CORPORATE REGISTRANTS)

         Indicate the number of shares  outstanding of each of the  registrant's
classes of common stock, as of the latest practicable date.

Title                                  Outstanding

Common Stock, par value $.01           11,500,000 shares as of November 9, 1999


<PAGE>                        2



                               NEWMARK HOMES CORP.
                                      INDEX

                                                                            Page

PART I.   Financial Information                                                3

ITEM 1.   Financial Statements                                                 3

  Condensed Consolidated Balance Sheet                                         3
  Condensed Consolidated Statement of Operations                               4
  Condensed Consolidated Statement of Stockholders' Equity                     6
  Condensed Consolidated Statement of Cash Flows                               7
  Notes to the Condensed Consolidated Financial Statements                     8

ITEM 2.  Management's Discussion and Analysis of Financial Condition and
         Results of Operations                                                10

ITEM 3.  Changes in Information About Market Risk - None.                     15

PART II. Other Information                                                    15

ITEM 1.  Legal Proceedings - None.                                            15

ITEM 2.  Changes in Securities - None.                                        15

ITEM 3.  Defaults Upon Senior Securities - None                               15

ITEM 4.  Submission of Matters to a Vote of Security Holders - None.          16

ITEM 5.  Other Information - None                                             16

ITEM 6.  Exhibits and Reports on Form 8-K                                     16

         Exhibits                                                             16
         Exhibit 27 - Financial Data Schedule                                 16

         Reports on Form 8-K                                                  16


         Signatures                                                           16


<PAGE>                        3


Part I.  Financial Information

Item 1.  Financial Statements
<TABLE>
<CAPTION>

                      NEWMARK HOMES CORP. AND SUBSIDIARIES
                      CONDENSED CONSOLIDATED BALANCE SHEETS
               (In thousands, except share and per share amounts)


                                ASSETS                                   September 30,        December 31,
                                                                             1999                 1998
                                                                        ----------------     ----------------
                                                                         (unaudited)
<S>                                                                           <C>                  <C>
Cash ................................................................         $   6,021            $   5,794
Receivables..........................................................            10,387                6,967
Inventory............................................................           240,977              185,247
Investment in unconsolidated subsidiaries ...........................               713                  490
Other assets, net ...................................................            10,308                9,196
Goodwill, net of accumulated amortization of $6,245 and $5,173 in
     1999 and 1998, respectively ....................................            36,572               37,644
                                                                        ----------------     ----------------

                  Total assets                                                $ 304,978            $ 245,338
                                                                        ================     ================


                 LIABILITIES AND STOCKHOLDERS' EQUITY

Construction loans payable ..........................................         $ 149,057            $ 106,839
Acquisition notes payable............................................             9,873               12,341
Other payables to affiliates ........................................               394                2,442
Accounts payable and accrued liabilities.............................            26,866               22,935
Other liabilities ...................................................            17,160               10,669
                                                                        ----------------     ----------------
                  Total liabilities..................................           203,350              155,226
                                                                        ----------------     ----------------

Stockholders' equity:
     Common stock -- $.01 par value; 30,000,000 shares authorized,
             11,500,000 shares issued and outstanding ...............               115                  115
     Additional paid-in capital......................................            73,768               73,768
     Retained earnings...............................................            27,745               16,229
                                                                        ----------------     ----------------
                  Total stockholders' equity.........................           101,628               90,112
                                                                        ----------------     ----------------

                  Total liabilities and stockholders' equity.........         $ 304,978            $ 245,338
                                                                        ================     ================

<FN>
                     See accompanying notes to the condensed
                       consolidated financial statements.
</FN>
</TABLE>

<PAGE>                        4

<TABLE>
<CAPTION>

                      NEWMARK HOMES CORP. AND SUBSIDIARIES
                 CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
               (In thousands, except share and per share amounts)
                                   (unaudited)

                                                                                     Three Months
                                                                                 Ended September 30,
                                                                                 -------------------
                                                                               1999                  1998
                                                                               ----                  ----
<S>                                                                         <C>                 <C>
Revenues.............................................................       $ 126,745           $  112,907
Cost of sales  ......................................................         103,951               93,900
                                                                          ----------------    ---------------

Gross profit.........................................................          22,794               19,007
Equity in earnings from unconsolidated subsidiaries  ................             195                  262
Selling, general and administrative expenses.........................         (13,574)             (12,055)
Depreciation and amortization........................................          (1,010)              (1,163)
                                                                          ----------------    ---------------
     Operating income ...............................................           8,405                6,051
Other income (expense):
     Interest expense ...............................................            (466)                (419)
     Other income, net ..............................................             315                  510
                                                                          ----------------    ---------------

          Income before income taxes ................................           8,254                6,142
Income taxes ........................................................           2,924                2,301
                                                                          ----------------    ---------------

          Net income                                                         $  5,330            $   3,841
                                                                          ================    ===============

Earnings per common share:

     Basic                                                                      $ .46               $ .33
                                                                          ================    ===============
     Diluted                                                                    $ .46               $ .33
                                                                          ================    ===============
Weighted average number of shares of common stock equivalents outstanding:

     Basic                                                                   11,500,000          11,500,000
                                                                          ================    ===============
     Diluted                                                                 11,500,000          11,613,667
                                                                          ================    ===============
<FN>
                     See accompanying notes to the condensed
                       consolidated financial statements.
</FN>
</TABLE>

<PAGE>                        5
<TABLE>
<CAPTION>

                      NEWMARK HOMES CORP. AND SUBSIDIARIES
                 CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
               (In thousands, except share and per share amounts)
                                   (unaudited)

                                                                                      Nine Months
                                                                                  Ended September 30,
                                                                                  -------------------
                                                                                1999               1998
                                                                                ----               ----
<S>                                                                          <C>                 <C>
Revenues.............................................................        $ 349,957           $ 285,160
Cost of sales  ......................................................          292,518             238,022
                                                                           --------------      --------------

Gross profit.........................................................           57,439              47,138
Equity in earnings from unconsolidated subsidiaries  ................              516                 602
Selling, general and administrative expenses.........................          (36,761)            (31,199)
Depreciation and amortization........................................           (2,780)             (2,673)
                                                                           --------------      --------------
     Operating income ...............................................           18,414              13,868
Other income (expense):
     Interest expense ...............................................           (1,281)             (1,558)
     Other income, net ..............................................              742                 962
                                                                           --------------      --------------

          Income before income taxes ................................           17,875              13,272
Income taxes ........................................................            6,359               4,977
                                                                           --------------      --------------

          Net income                                                         $  11,516           $   8,295
                                                                           ==============      ==============

Earnings per common share:

       Basic                                                                  $  1.00               $ .76
                                                                           ==============      ==============
       Diluted                                                                $  1.00               $ .76
                                                                           ==============      ==============
Weighted average number of shares of common stock equivalents outstanding:

       Basic                                                                 11,500,000          10,878,755
                                                                           ==============      ==============
       Diluted                                                               11,500,000          10,954,949
                                                                           ==============      ==============
<FN>
                     See accompanying notes to the condensed
                       consolidated financial statements.
</FN>
</TABLE>

<PAGE>                        6


<TABLE>
<CAPTION>

                      NEWMARK HOMES CORP. AND SUBSIDIARIES
            CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
                                 (In thousands)
                                   (unaudited)


                                                                   Additional
                                                    Common           Paid-In        Retained
                                                      Stock          Capital        Earnings         Total
                                                    -----------    ------------    ------------    -----------
<S>                                                    <C>          <C>             <C>            <C>
Balance, December 31, 1998.........................    $ 115        $ 73,768        $ 16,229       $ 90,112
Net income.........................................       -               -           11,516         11,516
                                                    -----------    ------------    ------------    -----------
Balance, September 30, 1999........................    $ 115        $ 73,768        $ 27,745       $101,628
                                                    ===========    ============    ============    ===========




Balance, December 31, 1997 ........................     $ 92        $ 52,165         $ 3,434       $ 55,691
Initial public offering of common stock, net
of issuance of costs of $2,554,000, March 13, 1998.       20          18,426               -         18,446

Issuance of common stock due to the exercise of
underwriters over-allotment option, net of issuance
costs of $271,000, April 3, 1998...................        3           2,876               -          2,879

Capital contribution...............................                      301               -            301
Net income.........................................        -               -           8,295          8,295
                                                    -----------    ------------    ------------    -----------
Balance, September 30, 1998........................    $ 115        $ 73,768        $ 11,729       $ 85,612
                                                    ===========    ============    ============    ===========

<FN>
                     See accompanying notes to the condensed
                       consolidated financial statements.

</FN>
</TABLE>

<PAGE>                        7

<TABLE>
<CAPTION>

                      NEWMARK HOMES CORP. AND SUBSIDIARIES
                 CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                                 (In thousands)
                                   (unaudited)
                                                                                     Nine Months
                                                                                 Ended September 30,
                                                                                 -------------------
                                                                              1999                1998
                                                                          --------------     ----------------
<S>                                                                       <C>                <C>
Cash flows from operating activities:
   Net income.......................................................      $  11,516          $    8,295
   Adjustments to reconcile net income to net cash used in operating
     activities:
     Depreciation and amortization..................................          2,780               2,673
     Net (gain) loss on sale of property, premises and equipment....            (35)                 25
     Equity in earnings from unconsolidated subsidiaries............           (516)               (602)
     Changes in operating assets and liabilities, net  of effects
     from purchase of Westbrooke Communities, Inc.:
         Inventory and land held for development, net...............        (55,211)            (43,778)
         Receivables................................................         (3,420)             (4,128)
         Other assets ..............................................         (1,592)              1,666
         Payable to affiliates......................................         (2,048)               (710)
         Accounts payable and accrued liabilities...................          3,932               1,547
         Other liabilities..........................................          6,490               7,710
                                                                          --------------     ----------------
         Net cash used in operating activities  ....................        (38,104)            (27,302)
                                                                          --------------     ----------------

Cash flows from investing activities:
   Purchases of property, premises and equipment ...................         (1,841)             (1,544)
   Proceeds from sales of property, premises and equipment..........            129                 ---
   Increase in goodwill ............................................            ---                (444)
   Cash acquired in purchase of Westbooke Communities, Inc..........            ---               3,618
   Investment in unconsolidated subsidiaries                                   (348)                ---
   Distributions from unconsolidated subsidiaries ..................            641                 668
                                                                          --------------     ----------------
         Net cash provided by (used in) investing activities .......         (1,419)              2,298
                                                                          --------------     ----------------

Cash flows from financing activities:
   Net proceeds from initial public offering of common stock........            ---              18,446
   Net proceeds from Underwriters over-allotment option.............            ---               2,879
   Capital contributions received ..................................            ---                 301
   Proceeds from advances on construction loans payable ............        263,707             207,685
   Principal payments on construction loans payable.................       (221,489)           (188,536)
   Principal payments on acquisition notes payable..................         (2,468)            (13,381)
                                                                          --------------     ----------------
         Net cash provided by financing activities..................         39,750              27,394
                                                                          --------------     ----------------

Increase  in cash ..................................................            227               2,390
Cash, beginning of period ..........................................          5,794                 746
                                                                          --------------     ----------------
Cash, end of period ................................................      $   6,021          $    3,136
                                                                          ==============     ================

Supplemental disclosures of cash flow information:
   Cash paid for:
     Interest ......................................................      $   9,494          $   6,876
                                                                          ==============     ================
     Income taxes ..................................................      $   8,481          $   6,391
                                                                          ==============     ================

<FN>

                     See accompanying notes to the condensed
                       consolidated financial statements.
</FN>
</TABLE>

<PAGE>                        8

            NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Note 1.       Summary of Significant Accounting Policies

Organization

Newmark  Homes  Corp.  and  subsidiaries   (the  Company)  is  a  majority-owned
subsidiary of Pacific  Realty Group,  Inc.  (PRG) and ultimately a subsidiary of
Pacific USA Holdings  Corp.  (PUSA).  The Company was formed in December 1994 to
serve as a real estate holding company.

The Company's primary subsidiaries are as follows:
<TABLE>
<CAPTION>

                   Subsidiary                                         Nature of Business
<S>                                                <C>
Newmark Home Corporation (Newmark) .........       Single-family    residential   homebuilding   in   Texas,
                                                   Tennessee and North Carolina -formed in 1983.
Westbrooke Communities, Inc. (Westbrooke)          Single-family   residential   homebuilding   in   Florida
                                                   -formed in 1976.
The Adler Companies, Inc. (Adler) ..........       Single-family   residential   homebuilding   in   Florida
                                                   -formed in 1990.
Pacific United Development Corporation             Residential   lot  development  in  Texas  and  Tennessee
 .....(PUDC)                                        -formed in 1993.
</TABLE>

Basis of Presentation

The consolidated  financial  statements  include the accounts of the Company and
its subsidiaries.  The accounting and reporting  policies of the Company conform
to generally  accepted  accounting  principles and general  practices within the
homebuilding  industry.  All significant  intercompany balances and transactions
have been eliminated in the consolidated financial statements.

The preparation of financial  statements in accordance  with generally  accepted
accounting principles requires management to make estimates and assumptions that
affect the amounts reported in the financial  statements and accompanying notes.
Actual results could differ from those estimates.

Interim presentation

The accompanying  condensed consolidated financial statements have been prepared
by the Company and are unaudited.  Certain information and footnote  disclosures
normally included in financial statements presented in accordance with generally
accepted   accounting   principles  have  been  omitted  from  the  accompanying
statements.  The Company's management believes the disclosures made are adequate
to make  the  information  presented  not  misleading.  However,  the  financial
statements should be read in conjunction with the financial statements and notes
thereto included in the Company's December 31, 1998 Annual Report on Form 10-K.

Earnings per share

Basic earnings per share is computed by dividing earnings attributable to common
shareholders by the weighted average number of common shares outstanding for the
period.  Diluted  earnings per share reflects the potential  dilution that could
occur if securities or other  contracts to issue common stock were  exercised or
converted  into common  stock or resulted in the  issuance of common  stock that
then shared in the earnings of the Company.

The following  tables reconcile the computation of basic and diluted EPS for the
three  months  ended  September  30, 1999 and 1998 and for the nine months ended
September 30, 1999 and 1998.
<PAGE>                        9

<TABLE>
<CAPTION>

                                   Three Months Ended September 30, 1999             Three Months Ended September 30, 1998
                                ---------------------------------------------     ---------------------------------------------

                                 Income           Shares         Per Share          Income          Shares        Per Share
                               (Numerator)    (Denominator)       Amount         (Numerator)    (Denominator)       Amount
                              -------------- ----------------- --------------   --------------- --------------- ---------------
<S>                              <C>               <C>                  <C>           <C>           <C>                   <C>
Basic EPS
      Income available to
      common shareholders        $5,330,000        11,500,000           $.46          $3,84100      11,500,000            $.33
                                                               ==============                                   ===============

Effect of Dilutive Securities
      1998  Tandem Stock
      Option Plan                     -----             -----                            -----         113,667
                              -------------- -----------------                  --------------- ---------------

Diluted EPS
      Income available to
      common shareholders +
      assumed conversions        $5,330,000        11,500,000           $.46        $3,841,000      11,613,667            $.33
                              ============== ================= ==============   =============== =============== ===============

</TABLE>
<TABLE>
<CAPTION>

                                   Nine Months Ended September 30, 1999              Nine Months Ended September 30, 1998
                              -----------------------------------------------   -----------------------------------------------

                                 Income           Shares         Per Share          Income           Shares        Per Share
                               (Numerator)    (Denominator)       Amount         (Numerator)     (Denominator)       Amount
                              -------------- ----------------- --------------   ---------------  ---------------  -------------
<S>                             <C>                <C>                 <C>          <C>              <C>                  <C>
Basic EPS
      Income available to
      Common shareholders       $11,516,000        11,500,000          $1.00        $8,295,000       10,878,755           $.76
                                                               ==============                                     =============

Effect of Dilutive Securities
      1998  Tandem Stock
      Option Plan                     -----             -----                            -----           76,194
                              -------------- -----------------                  ---------------  ---------------

Diluted EPS
      Income available to
      common shareholders +
      assumed conversions       $11,516,000        11,500,000          $1.00        $8,295,000       10,954,949           $.76
                              ============== ================= ==============   ===============  ===============  =============
</TABLE>

<PAGE>                        10

Note 2.       Inventory

The  inventory  as of September  30, 1999 and December 31, 1998  consists of the
following:
<TABLE>
<CAPTION>

                                                                                               Carrying value
                                                     Number of homes                           (in thousands)
                                          --------------------------------------    --------------------------------------
                                           September 30,         December 31,        September 30,         December 31,
                                                1999                 1998                1999                  1998
                                          -----------------    -----------------    ----------------     -----------------
<S>                                                    <C>                  <C>           <C>                   <C>
Completed  ...............................             129                  118          $   27,603             $  23,224
Under construction  ......................           1,181                  829             135,971                98,692
Models  ..................................              85                   74              19,146                15,401
Residential lots..........................             ---                  ---              58,257                47,930
                                          -----------------    -----------------    ----------------     -----------------
               Total                                 1,395                1,021          $  240,977             $ 185,247
                                          =================    =================    ================     =================
</TABLE>

Note 3.       Capitalized Interest

A summary of interest capitalized in inventory is as follows (in thousands):
<TABLE>
<CAPTION>

                                                      Three Months Ended                   Nine Months Ended
                                                        September 30,                        September 30,
                                                -------------------------------    ----------------------------------
                                                    1999              1998             1999               1998
                                                --------------    -------------    --------------    ----------------
<S>                                                  <C>              <C>               <C>                 <C>
Interest capitalized, beginning of period .....      $  5,814         $  5,542          $  5,516            $  2,572
Capitalized interest acquired in purchase of
      Westbrooke Communities, Inc..............           ---                -               ---               2,597
Interest incurred .............................         3,197            2,690             9,017               7,859
Less interest included in:
      Cost of sales ...........................         2,544            2,412             7,251               6,069
      Other income (expense) ..................           466              419             1,281               1,558
                                                --------------    -------------    --------------    ----------------
Interest capitalized, end of period ...........        $6,001         $  5,401          $  6,001            $  5,401
                                                ==============    =============    ==============    ================
</TABLE>

Note 4.       Commitments and Contingencies

The Company is subject to certain  pending or  threatened  litigation  and other
claims.  Management,  after review and consultation with legal counsel, believes
the Company has  meritorious  defenses to these  matters and that any  potential
liability  from  these  matters  would  not  materially   affect  the  Company's
consolidated financial statements.


Item 2. Management's  Discussion and Analysis of Financial Condition and Results
of Operation

This Quarterly Report on Form 10-Q may contain forward-looking statements within
the  meaning of Section  27A of the  Securities  Act of 1933,  as  amended,  and
Section 21E of the Securities  Exchange Act of 1934, as amended.  Actual results
could differ materially from those projected in the  forward-looking  statements
as a result of the risk factors set forth below.


<PAGE>                        11



Results of Operations

The  following  tables set forth certain  operating  and financial  data for the
Company:
<TABLE>
<CAPTION>

                               New Sales Contracts,
                               Net of Cancellations             Home Closings
                              ------------------------
                                                           ------------------------
                                   Three Months                 Three Months
                                Ended September 30,          Ended September 30,
                              ------------------------     ------------------------
                                     1999        1998            1999         1998
                                     ----        ----            ----         ----
<S>                                   <C>         <C>             <C>          <C>
Houston                               149         124             170          148
Austin                                131         119             131          110
Dallas/Ft. Worth                       27          47              48           42
Nashville                              27          20              27            8
Charlotte/
Greensboro                              2           -               5            -
Ft. Lauderdale/
Palm Beach/Miami                      223         180             120          200
                                      ---         ---             ---          ---
Total                                 559         490             501          508
                                      ===         ===             ===          ===
</TABLE>
<TABLE>
<CAPTION>

                               New Sales Contracts,                                             Homes in
                               Net of Cancellations             Home Closings                Sales Backlog
                             -------------------------     ------------------------    ---------------------------
                                   Nine Months                   Nine Months                     As of
                               Ended September 30,           Ended September 30,             September 30,
                             -------------------------     ------------------------    ---------------------------
                                   1999          1998             1999        1998             1999          1998
                                   ----          ----             ----        ----             ----          ----
<S>                                 <C>           <C>              <C>         <C>              <C>           <C>
Houston                             449           456              473         349              151           204
Austin                              455           385              378         297              261           173
Dallas/Ft. Worth                    112           143              119         116               50            69
Nashville                            63            40               63          14               22            26
Charlotte/
Greensboro                            7             -                5           -                2             -
Ft. Lauderdale/
Palm Beach/Miami                    654           618              368         546              601           439
                                    ---           ---              ---         ---              ---           ---
Total                             1,740         1,642            1,406       1,322            1,087           911
                                  =====         =====            =====       =====            =====           ===
</TABLE>

<PAGE>                        12

<TABLE>
<CAPTION>

                                                     As a Percentage of Revenue            As a Percentage of Revenue
                                                                 Three Months                         Nine Months
                                                             Ended September 30,                  Ended September 30,
                                                     ------------------------------------- ----------------------------------
                                                           1999              1998              1999              1998
                                                           ----              ----              ----              ----
<S>                                                       <C>               <C>               <C>                <C>
Cost of sales                                             82.0%             83.2%             83.6%              83.5%
Gross profit                                              18.0%             16.8%             16.4%              16.5%
Selling, general and administrative expenses              10.7%             10.7%             10.5%              10.9%
Income before income taxes                                 6.5%              5.4%              5.1%               4.7%
Income taxes (1)                                          35.4%             37.5%             35.6%              37.5%
Net income                                                 4.2%              3.4%              3.3%               2.9%
<FN>
(1) As a percent of income before income taxes.
</FN>
</TABLE>

Three Months Ended  September 30, 1999 Compared to Three Months Ended  September
30, 1998.

Revenues  for the three months ended  September  30, 1999  increased by 12.3% to
$126.7 million from $112.9  million for the comparable  period of 1998 due to an
increase in the average selling prices due to increased level of closings in the
Company's  higher priced markets.  However,  the total number of homes closed by
the Company  decreased by 1.3% to 501 homes in the three months ended  September
30,  1999  from 508  homes in the same  period of 1998.  The  Company's  average
selling  price of homes closed in the three months ended  September 30, 1999 was
$247,209,  an increase of 11.5% from the $221,797  average  selling price in the
comparable  period of 1998.  Revenue  from land sales for the three months ended
September 30, 1999 increased to $2.9 million from $.2 million for the comparable
period of 1998.

New net sales contracts  increased 14.1% to 559 homes for the three months ended
September 30, 1999 from 490 homes for the three months ended September 30, 1998.
The dollar amount of new net sales contracts increased 23.1% to $133.2 million.

The Company was operating in 73  subdivisions  at September 30, 1999 compared to
60  subdivisions  at September 30, 1998.  At September  30, 1999,  the Company's
backlog of sales  contracts was 1,087 homes,  a 19.3%  increase over  comparable
figures at September 30, 1998.

Cost of sales  increased  by 10.7% to $103.9  million in the three  months ended
September 30, 1999 from $93.9 million in the comparable period of 1998 primarily
due to increased  revenues from home closings.  Cost of land sales for the three
months ended  September 30, 1999  increased to $2.2 million from $.1 million for
the  comparable  period of 1998. As a percentage of revenues,  cost of sales for
the three months ended  September 30, 1999 decreased to 82.0% in 1999 from 83.2%
in 1998 due to  strong  gains in the level of  closings  in the  Company's  most
profitable markets.

Selling,  general and administrative  (SG&A) expense increased by 12.6% to $13.6
million in the three months ended  September 30, 1999, from $12.1 million in the
comparable  period of 1998. As a percentage of revenues,  SG&A expense  remained
consistent  at 10.7% in 1999 and 1998.  The increase was caused by the expansion
into the new markets of Nashville, Tennessee and Charlotte and Greensboro, North
Carolina as well as the expansion in the Company's Texas markets as indicated by
the 19.3% increase in the backlog at the end of September 1999 versus  September
1998.

Interest expense amounted to $.5 million in the three months ended September 30,
1999  compared  to $.4  million in the  comparable  period of 1998.  The Company
follows a policy of capitalizing  interest only on inventory under  construction
or  development.  During the three months ended September 30, 1999 and 1998, the
Company  expensed a portion of interest  incurred and other  financing  costs on
those  completed  homes  held  in  inventory.  Capitalized  interest  and  other
financing costs are included in cost of sales at the time of home closings.

The Company's  provision for income taxes  decreased as a percentage of earnings
before taxes to 35.4% for the three months ended  September 30, 1999 compared to
37.5%  for  the  three  months  ended   September  30,  1998.  The  decrease  is
attributable  to a state  income tax benefit for Adler.  Under a tax  allocation
agreement with PUSA, the Company is required to calculate its federal  corporate
income tax  liability  as if it filed a separate  federal  income tax return for
each period and to pay PUSA the sum which would result from such  calculation if
the Company  were subject to federal  corporate  income tax and filed a separate
tax return.  The Company  recognized  federal  income tax expense  under the tax
allocation  agreement  amounting  to $2.9  million  for the three  months  ended
September 30, 1999 compared to $2.2 million for the three months ended September
30, 1998.

Net  income  increased  by 38.8%  to $5.3  million  in the  three  months  ended
September  30, 1999,  from $3.8 million in the  comparable  period of 1998.  The
increase is primarily attributable to the strong gains in revenues and increased
gross profits in the Company's most profitable markets.
<PAGE>                        13

Nine Months Ended September 30, 1999 Compared to Nine Months Ended September 30,
1998.

Revenues  for the nine months  ended  September  30, 1999  increased by 22.7% to
$350.0 million from $285.2  million for the comparable  period of 1998 due to an
increase in the average selling prices due to increased level of closings in the
Company's  higher  priced  markets.  The number of homes  closed by the  Company
increased  by 6.4% to 1,406 homes in the nine months  ended  September  30, 1999
from 1,322 homes in the same period of 1998. The Company's average selling price
of homes closed in the nine months ended  September  30, 1999 was  $240,288,  an
increase of 12.0% from the  $214,466  average  selling  price in the  comparable
period of 1998.  Revenue from land sales for the nine months ended September 30,
1999 increased to $12.1 million from $2.9 million for the  comparable  period of
1998.

New net sales contracts  increased 6.0% to 1,740 homes for the nine months ended
September  30,  1999 from 1,642 homes for the nine months  ended  September  30,
1998.  The dollar amount of new net sales  contracts  increased  14.8% to $406.9
million.

Cost of sales  increased  by 22.9% to $292.5  million in the nine  months  ended
September 30, 1999 from $238 million in the comparable  period of 1998 primarily
due to increased  revenues from home  closings.  Cost of land sales for the nine
months ended September 30, 1999 increased to $10.2 million from $1.6 million for
the  comparable  period of 1998. As a percentage of revenues,  cost of sales for
the nine months ended  September 30, 1999  increased to 83.6% in 1999 from 83.5%
in 1998 due to  strong  gains in the level of  closings  in the  Company's  most
profitable markets.

Selling,  general and administrative  (SG&A) expense increased by 17.8% to $36.8
million in the nine months ended  September  30, 1999 from $31.2  million in the
comparable  period of 1998. As a percentage of revenues,  SG&A expense decreased
slightly to 10.5% in 1999 from 10.9% in 1998.  This  increase  was caused by the
expansion  into the new  markets  of  Nashville,  Tennessee  and  Charlotte  and
Greensboro,  North  Carolina as well as the  expansion  in the  Company's  Texas
markets  as  indicated  by the  19.3%  increase  in the  backlog  at the  end of
September 1999 versus September 1998.

Interest expense amounted to $1.3 million in the nine months ended September 30,
1999  compared to $1.6  million in the  comparable  period of 1998.  The Company
follows a policy of capitalizing  interest only on inventory under  construction
or  development.  During the nine months ended  September 30, 1999 and 1998, the
Company  expensed a portion of interest  incurred and other  financing  costs on
those  completed  homes held in  inventory.  This expense  decreased  due to the
decrease in the average number of completed homes held in inventory for the nine
months ended  September 30, 1999 compared to the nine months ended September 30,
1998.  Capitalized  interest and other  financing  costs are included in cost of
sales at the time of home closings.

The Company's  provision for income taxes  decreased as a percentage of earnings
before taxes to 35.6% for the nine months ended September 30, 1999,  compared to
37.5% for the nine months ended September 30, 1998. The decrease is attributable
to a state income tax benefit for Adler.  Under a tax allocation  agreement with
PUSA,  the Company is required to  calculate  its federal  corporate  income tax
liability  as if it filed a separate  federal  income tax return for each period
and to pay PUSA the sum which would result from such  calculation if the Company
were  subject to federal  corporate  income tax and filed a separate tax return.
The  Company  recognized  federal  income tax expense  under the tax  allocation
agreement amounting to $6.4 million for the nine months ended September 30, 1999
compared to $4.7 million for the nine months ended September 30, 1998.

Net  income  increased  by 38.9%  to $11.5  million  in the  nine  months  ended
September  30,  1999 from $8.3  million in the  comparable  period of 1998.  The
increase is primarily attributable to the strong gains in revenues and increased
gross profits in the Company's most profitable markets.
<PAGE>                        14

Financial Condition, Liquidity and Capital Resources

At September 30, 1999,  the Company had available  cash and cash  equivalents of
$6.0  million.   Inventories  (including  finished  homes  and  construction  in
progress,  developed  residential  lots and other  land) at  September  30, 1999
increased  by $55.8  million  from $185.2 at December  31, 1998 due to a general
increase in business  activity  and the  expansion  of  operations  in the newer
market  areas.  Because of the  increased  business  activity  and  expansion of
operations in the newer  markets,  the  Company's  ratio of  construction  loans
payable to total  capital  assets  increased to 60.4% at September 30, 1999 from
56.0% at December 31, 1998.  The equity to total assets ratio  decreased  during
the nine months to 33.3% at September 30, 1999 from 36.7% at December 31, 1998.

The Company's  financing needs depend upon the results of its operations,  sales
volume, inventory levels, inventory turnover, and acquisitions.  The Company has
financed its  operations  through  borrowings  from financial  institutions  and
through funds from earnings.

At September 30, 1999,  the Company had unused lines of credit for  construction
loans totaling  approximately $243.9 million of which $25.2 million is available
to draw down.

The Company's  growth  requires  significant  amounts of cash. It is anticipated
that future home  construction,  lot and land purchases and acquisitions will be
funded  through  internally  generated  funds  and  new and  existing  borrowing
relationships.  The Company continuously evaluates its capital structure and, in
the future,  may seek to further  increase  secured  debt and obtain  additional
equity  to  fund  ongoing  operations  as well as to  pursue  additional  growth
opportunities.

Except for ordinary expenditures for the construction of homes and, to a limited
extent,  the  acquisition of land and lots for development and sale of homes, at
September  30,  1999,  the  Company  had no  material  commitments  for  capital
expenditures.


Seasonality and Quarterly Results

The homebuilding  industry is seasonal, as generally there are more sales in the
spring and summer  months,  resulting  in more home  closings  in the fall.  The
Company  operates in the  Southwestern  and  Southeastern  markets of the United
States, where weather conditions are more suitable to a year-round  construction
process than other areas. The Company also believes its geographic dispersion to
be somewhat  counter-cyclical,  with adverse economic conditions associated with
certain of its markets often being offset by more favorable economic  conditions
in other  areas.  The  seasonality  of school terms has an impact on the Company
operations,  but it is somewhat mitigated by the fact that many of the Company's
buyers at the higher end of the Company's price range, including Fedrick, Harris
custom homes,  no longer have children in school.  As a result of these factors,
among others,  the Company  generally  experiences  more sales in the spring and
summer  months,  and more  closings  in the  summer and fall  months.  Likewise,
Westbrooke has  experienced  seasonality in its revenues,  generally  completing
more  sales in the spring and  summer  months  and more  closings  in the fourth
quarter.

The Company historically has experienced,  and in the future expects to continue
to experience, variability in revenues on a quarterly basis. Factors expected to
contribute to the  variability  include,  among  others:  (i) the timing of home
closings;  (ii) the Company's ability to continue to acquire land and options on
acceptable  terms;  (iii) the timing of receipt of regulatory  approvals for the
construction of homes;  (iv) the condition of the real estate market and general
economic conditions;  (v) the cyclical nature of the homebuilding industry; (vi)
prevailing  interest rates and the  availability  of mortgage  financing;  (vii)
pricing policies of the Company's competitors;  (viii) the timing of the opening
of new residential projects;  (ix) weather; and (x) the cost and availability of
materials  and labor.  The Company's  historical  financial  performance  is not
necessarily a meaningful indicator of future results and the Company expects its
financial results to vary from project to project from quarter to quarter.
<PAGE>                        15

Year 2000 Readiness Disclosure

The company has  assessed and is  continuing  to assess its  operating  systems,
computer  software  applications,  computer  equipment and other  equipment with
embedded  electronic  circuits  ("Programs")  that it currently used to identify
whether they are year 2000 compliant and, if not, what steps are needed to bring
them into  compliance.  The Company  expects that the majority of all  Programs,
including  computer   information  systems  utilized  in  its  homebuilding  and
residential lot development operations,  will be year 2000 compliant by December
31, 1999.  For those Programs that will not be compliant by them, the Company is
reviewing  the  potential  impact on the Company and the  alternatives  that are
available to it if the Programs  cannot be brought into  compliance  by December
31, 1999. The Company believes that the required changes to its Programs will be
made on a timely basis without causing material  operational  issues or having a
material impact on its results of operations or its financial position.

The Company  believes  that,  should a  reasonably  likely  worst case Year 2000
situation occur, the Company,  because of the basic nature of its systems,  many
of which can be executed  manually,  would not likely  suffer  material  loss or
disruption in remedying  the  situation.  The costs  incurred and expected to be
incurred in the future regarding Year 2000 compliance have been and are expected
to be  immaterial  to the results of  operation  and  financial  position of the
Company. Costs related to Year 2000 compliance are expensed as incurred.

The  Company  has  been  reviewing   whether  its  significant   subcontractors,
suppliers,  financial institutions and other service providers ("Providers") are
Year 2000  compliant.  The  Company  is not aware of any  Providers  that do not
expect to be compliant;  however,  the Company has no means of ensuring that its
Providers  will be Year 2000 ready.  The  inability of Providers to be Year 2000
ready in a timely  fashion  could have an  adverse  impact on the  Company.  The
Company plans to respond to any such contingency  involving any of its Providers
by seeking to utilize  alternative  sources for such goods and  services,  where
practicable.   In   addition,   widespread   disruptions   in  the  national  or
international economy,  including, for example,  disruptions affecting financial
markets,  commercial and  investment  banks,  governmental  agencies and utility
services, such as heat, lights, power and telephones, could also have an adverse
impact on the Company.  The likelihood and effects of such  disruptions  are not
determinable at this time.




Item 3.  Changes in Information About Market Risk

 .........No disclosure required.

Part II.  Other Information

Item 1.  Legal Proceedings

 .........No disclosure required.

Item 2.  Changes in Securities

 .........No disclosure required.



Item 3.  Defaults Upon Senior Securities

 .........No disclosure required.
<PAGE>                        16

Item 4.  Submission of Matters to a Vote of Security Holders

The Annual  Meeting of  Stockholders  of the Company was held on August 4, 1999.
Proxies  were  solicited  by the  Company  pursuant to  Regulation  14 under the
Securities  Exchange  Act of 1934 to  elect  directors  of the  Company  for the
ensuing year.

Proxies  and  shareholders  present  representing  11,021,000  shares  of  stock
eligible to vote at the meeting, or 95.8 percent of the outstanding shares, were
voted in connection with the election of directors.  The following is a separate
tabulation with respect to the vote for each nominee:
<TABLE>
<CAPTION>

             Name                          Total Votes For            Total Votes Withheld
            ------                        -----------------          -----------------------
       <S>                                    <C>                               <C>
       Michael K. McCraw                      11,021,000                        0
       Larry D. Horner                        11,021,000                        0
       Bill C. Bradley                        11,021,000                        0
       William A. Hasler                      11,021,000                        0
       Jon P. Newton                          11,021,000                        0
       Lonnie M. Fedrick                      11,021,000                        0
       James M. Carr                          11,021,000                        0

</TABLE>

Item 5.  Other Information

 .........No disclosure required.

Item 6.  Exhibits and Reports on Form 8-K

1.    Exhibit 27 - Financial Data Schedule.

2........Reports on Form 8-K.

        Report  on Form 8-K  dated  as of  August  12,  1999  pertaining  to the
        Registrant being advised that its majority owner,  Pacific Realty Group,
        Inc. ("PRG"),  has entered into discussions with a foreign company for a
        transaction involving all or a portion of the Registrant's common stock.
        PRG currently owns 80% of the Registrant's common stock.


                                   SIGNATURES

         Pursuant to the  requirements  of the Securities  Exchange Act of 1934,
the  registrant  has duly  caused  this report to be signed on its behalf by the
undersigned, thereunto duly authorized.

                               NEWMARK HOMES CORP.

November 9, 1999                     By:    /s/ Terry C. White
Date                                     _______________________________________
                                         Terry C. White, Senior Vice President,
                                         Chief Financial Officer, Treasurer and
                                         Secretary