Monthly Survey of Real Estate Agents Decem ber 2018

Transcription

1 Monthly Survey of Real Estate Agents Decem ber 18 January 17, 19 Susan Maklari Analyst (212) Christopher Kalata (212) Amanda Luper (212) There s No Place Like Home for the Holidays In order to better assess conditions across the largest housing markets in the US, we surveyed ~7 real estate agents. Our December Buyer Index declined 1pts YOY to 33. This was up 4pts sequentially but is 3pts below the historical average for the month. Broadly, while trends improved from October and November lows, traffic held below expectations and days on market elongated with our Time to Sell Index at 22 coming in 12pts below the month s average. Given the holiday slowdown in the last two weeks, it remains uncertain whether the improvement in activity will hold through the spring. Regionally, Jacksonville, Dallas and Charlotte saw the largest traffic gains while Washington DC, Phoenix and Las Vegas declined YOY. Consistent with Builders, an Air of Uncertainty Lingers Results were consistent with recent builder commentary. Lennar highlighted a ~5bps sequential reduction in incentives as qualified buyer traffic picked up in December. That said, several companies (incl. Lennar) have opted to forgo 19 guidance as variability in the macro environment leads to a wider range of outcomes for the spring selling season. Although we anticipate a diminishing rate of growth overall, we believe areas of relative outperformance remain as differing trends across regions and price points become increasingly apparent. Housing Cycle in the Mid-to-Latter Stages We look for moderating growth to be driven by entry-level and first-time buyer demand. Our Outperform-rated names are DHI and PHM. DISCLOSURE APPENDIX AT THE BACK OF THIS REPORT CONTAINS IMPORTANT DISCLOSURES, ANALYST CERTIFICATIONS, LEGAL ENTITY DISCLOSURE AND THE STATUS OF NON-U.S ANALYSTS. U.S. Disclosure: Credit Suisse does and seeks to do business with companies covered in its research reports. As a result, investors should be aware that the Firm may have a conflict of interest that could affect the objectivity of this report. Investors should consider this report as only a single factor in making their investment decision.

2 Buyer Index Executive Summary: A December to Remember? Decem ber Buyer Index Down 1pts YOY to 33: This month s reading rose 4pts sequentially and was 3pts below the long-term historical average for December. Across geographies, agents continued to note buyer traffic recovering from October lows, partially attributable to stabilizing rates. This is consistent with commentary from builders, including Lennar last week. That said, and given the holiday slowdown the last two weeks of the month, it remains uncertain whether the improvement in activity will hold through the spring. Broadly, our surveyed realtors held two views of prospective buyers: 1) those motivated by incentives, moderating prices and rates to purchase prior to year-end, and 2) those potentially waiting for the spring in anticipation of additional inventory and further price deceleration. We note areas of relative affordability (i.e., Nashville, Raleigh, San Antonio) continue to see stronger traffic levels as in-migration and corporate relocations support sales. In turn, demand is outpacing supply at the firsttime/entry-level price points (below ~$3k) vs sluggishness at the high-end. levels at or above agents expectations in 1 out of the top * m arkets (vs 8 last year and 2 last m onth): The Index was up 1 to down 5 points YOY in 8 MSAs (Jacksonville, Dallas, Charlotte, New York-Northern NJ, Tampa, Atlanta, Nashville and Seattle). Was down 5+ points YOY in the remaining 11 (San Antonio, Miami, Raleigh, Los Angeles, Houston, Orlando, Denver, Austin, Washington DC, Phoenix and Las Vegas). Hom e Price Index Down 3pts YOY to 36: Although our agents saw prices hold up slightly better than in Oct/Nov, the majority noted sequential declines, reflected in our Index moderating for the eighth consecutive month. Prices rose year over year in two of our surveyed markets, consistent with last month. Inventory levels tightened in December as supply remains below historic norms. As prospective buyers take time to weigh their options, days on market increased with our Time to Sell Index at 22 down 23pts year over year (though +4pts sequentially) and 12pts below the long-term historical average for the month. Realtors Provide On-the-Ground Read on Conditions: We survey local agents on a monthly basis in order to better gauge changes in supply and demand. Results are used to calculate a diffusion index, with a reading of 5+ indicating an improvement <5 - Below Expectations; =5 - Meets Expectations; >5 - Exceeds Expectations (*) Note: the Inland Empire was excluded from our top market summary this month due to lack of respondents Please see appendix for a detailed description of our survey and index calculation methodology. <5 - Lower than Prior Month; =5 - Flat vs Prior Month; >5 - Higher than Prior Month Source: Credit Suisse

3 December Top Summary Top MSAs Prior Month Buyer Index Home Price Index Home Index Sell Time Index Builder Incentives Index 1 Jacksonville, FL 4(+3) 35 (+1) (-16) 75 (+19) 35 (-9) (+9) 2 Dallas, TX 17(+15) (+1) 27 (-38) 5 (-1) 13 (-22) 21 (-6) 3 Charlotte, NC 13(+1) 42 (+9) (-35) 7 (+1) 18 (-14) 38 (-13) 4 New York-Northern NJ 11(+7) 38 (+4) 28 (-33) 47 (-33) 18 (-41) (-17) 5 Tampa, FL 8(+3) 33 (+2) 43 (-44) 45 (-32) (-39) 33 (-18) 6 Atlanta, GA 9(+3) 33 () 3 (-47) 63 (-) 26 (-) 33 (+7) 7 Nashville, TN 18(+11) 5 () 35 (-28) 55 (-1) (-3) 44 (+13) 8 Seattle, WA 1(+2) 41 (-5) 24 (-44) 61 (-3) (-35) 3 (-3) 9 San Antonio, TX 5(-4) 44 (-6) 5 (-38) 63 (-25) 56 (+6) 19 (-6) 1 Miami, FL 12(+2) 24 (-1) 38 (-12) 29 (-18) 26 (+1) 39 (+6) 11 Raleigh, NC 3(-8) 47 (-13) 28 (-62) 57 (+7) (-) 29 (-21) 12 Los Angeles, CA 14(+2) 28 (-15) (-1) 53 (-21) 6 (-41) 27 (-21) 13 Houston, TX 16(+3) 27 (-15) 42 (-4) 54 (-21) 12 (-25) 35 (-6) 14 Orlando, FL 7(-7) 23 (-) (-19) 37 (-29) (-14) 47 (-3) 15 Denver, CO 6(-9) 36 (-22) 43 (-23) 5 (-24) 14 (-3) 36 (-6) 16 Austin, TX 2(-14) 25 (-25) 92 (+1) 5 (+31) 25 (-6) 33 (-1) Agent Highlights Although traffic levels held below expectations, agents noted buyers returning to the market. This comes as employment opportunities rise in the MSA and prices declined sequentially for the first time in the last 18 months. Despite improved year over year activity, realtors saw buyers waiting for bargains and lacking a sense of urgency. As such, the majority of agents (73%) noted an increase in the length of time needed to sell a home. The move-down in rates corresponded with an increase in activity as prospective buyers sought to close prior to year-end. Relocations to the MSA continue to support fundamental demand. As inventory levels rise off of autumn lows, prices continue to moderate. In turn, buyers are split between bargain hunters scrambling to purchase before further rate increases and those waiting until additional supply comes online in the spring. Macroeconomic concerns alongside buyers fatigued from elevated prices kept traffic levels below expectations. That said, baby boomers (snowbirds) are beginning to return to the market. Demand held steady year over year as buyers remain on the hunt for affordable inventory (below $3k). This compares to a sluggish higher-end market (above $5k). Notably, agents saw more foot traffic in December than in the prior few months. Given mild weather, traffic levels improved to meet realtors' expectations. Although many noted the market returning to more normalized levels, demand continues to exceed supply at the entry-level. Agents saw buyer interest reignited this month by lower rates and a slight uptick in inventory levels. In turn, more serious buyers remained in the market during the holidays and were able to find good deals as prices moderate. Consumer confidence remains strong, supported by increased employment opportunities - especially in technology. That said, three-fourths of our surveyed respondents noted heightened incentives as builders look to attract buyers. Broad-based macro uncertainty and concerns over foreign relations are an overhang on the Miami housing market. Supply is increasing, especially at the luxury price points. Given anticipated slower traffic around the holidays, activity levels roughly met agents' expectations. This comes as price appreciation slows. Further, realtors noted prospective sellers getting ready for the spring market. Although prices are moderating, limited supply below $45k is driving elongated days on the market (88% of agents citing a time to sell above expectations). We also note less than anticipated traffic at open houses. Despite traffic below expectations, agents remain optimistic about the spring selling season. That said, elevated home prices and rising rates are pressuring affordability. Two-thirds of agents noted an increase in the length of time needed to sell a home as the government shutdown and a volatile stock market caused consumers to pause. This was likely exacerbated by the typical seasonal decline in traffic over the holidays. Activity continued to improve sequentially off October lows, with agents noting steady traffic considering the holiday season. Although inventory levels remain tight, our respondents are seeing prices moderate. Perhaps inanticipation of the selling season, the majority of agents saw anincrease in home prices following several months of stabilization. Reflecting this, alongside the distraction of the holidays, traffic levels declined below agents' expectations. 17 Washington, DC 19(+2) 38 (-25) 33 (-1) 72 (+9) 31 (-9) 25 (-16) 18 Phoenix, AZ 15(-3) 26 (-28) 32 (-33) 5 (-21) 16 (-28) 35 (-13) 19 Las Vegas, NV (+1) 1 (-52) 1 (-78) 3 (-43) 1 (-48) 3 (-16) Given the lack of available inventory, agents noted quality homes selling in multiple offer situations. Although some buyers are out and looking, our respondents don't anticipate heightened activity until the start of the selling season. We highlight rising demand due to Amazon HQ2 offset by uncertainty surrounding the government shutdown. The holiday season, poor weather and macro economic/political uncertainty combined to shrink the size of the buyer pool. Further, 72% of agents saw greater than anticipated days on market as buyers lacked a sense of urgency. Although prices moved lower sequentially, agents are seeing affordability constraints beginning to temper demand levels. This is compounded by a lack of entry-level inventory. Note: Inland Empire excluded from this month s survey due to lack of respondents; s ranked according to YOY change in Buyer Index

4 Table of Contents Key Housing s: Key Housing s Continued: 5 Atlanta, Georgia 27 New York-Northern New Jersey 6 Austin, Texas 28 Orlando, Florida 7 Baltimore, Maryland 29 Philadelphia-Southern New Jersey 8 Boston, Massachusetts 3 Phoenix, Arizona 9 Charleston, South Carolina 31 Portland, Oregon 1 Charlotte, North Carolina 32 Raleigh, North Carolina 11 Chicago, Illinois 33 Sacramento, California 12 Cincinnatti, OH 34 San Antonio, Texas 13 Columbus, OH 35 San Diego, California 14 Dallas, Texas 36 San Francisco, California 15 Denver, Colorado 37 Sarasota, Florida 16 Detroit, Michigan 38 Seattle, Washington 17 Fort Myers, Florida 39 Tampa, Florida 18 Houston, Texas Tucson, Arizona 19 Indianapolis, Indiana 41 Virginia Beach, VA Jacksonville, Florida 42 Washington, D.C. 21 Kansas City, Missouri 22 Las Vegas, Nevada 43 Appendix: 23 Los Angeles, California 44 Historical Trends by 24 Miami, Florida 49 Agent Recommendations 25 Minneapolis, Minnesota 51 Survey Methodology 26 Nashville, Tennessee 52 Disclosures

5 Buyer Index Atlanta, GA % 8% 6% % % % <5 - Below Expectations; =5 - Meets Expectations; >5 - Exceeds Expectations <5 - Lower than Prior Month; =5 - Flat vs Prior Month; >5 - Higher than Prior Month How Do the Recent 3 Days Compare to the Prior 3 Days... 36% 52% 12% 12% 49% 39% 59% 29% 12% 37% 59% 4% 7% 5% 43% The Buyer Index was unchanged YOY at 33: Demand held steady year over year as buyers remain on the hunt for affordable inventory (below $3k). The Hom e Price Index declined to 3 from 77 last year. More foot traffic in December compared to last three months. Normal traffic levels for the holiday period as opposed to the heightened activity of the prior two years. More buyers searching below $3k. Inventory remains paltry for affordable housing (<$3k) vs sluggishness above $5k esp. in the suburbs. Slight bump due to corporate year-end relocations. Uncertainty over the government shutdown. 3 rd largest market in the country 17 single family permits: 24,58 Source: Credit Suisse; Census Bureau, Builder Magazine, Metrostudy, Company Data Note: Indexes above 5 indicate exceeds expectations or higher Slide 5 17 Atlanta as a % of Total 1 D.R. Horton 3, % 7.3% 2 Century Communities 1, % 36.2% 3 PulteGroup 1,39 5.3% 4.9% 4 Lennar Corp % 2.1% 5 Smith Douglas Communities % 6 Taylor Morrison % 7.8% 7 Rocklyn Homes % 8 Ashton Woods Homes % 9 Green Brick Partners % 44.5% Top 9 Totals 9, %

6 Buyer Index Austin, TX % 8% 6% % % % <5 - Below Expectations; =5 - Meets Expectations; >5 - Exceeds Expectations <5 - Lower than Prior Month; =5 - Flat vs Prior Month; >5 - Higher than Prior Month How Do the Recent 3 Days Compare to the Prior 3 Days... 83% 17% % 17% 67% 17% 5% 5% 33% 67% % % % 5% 5% The Buyer Index fell to 25 from 5 last year. The Hom e Price Index increased to 92 from 81 in Dec 17: Perhaps in anticipation of the selling season, the majority of agents saw an increase in home prices following several months of stabilization. slowing down into the holidays. Macroeconomic uncertainty. Fear of rising interest rates. Seasonal decline and pricing pressures. 5 th largest market in the country 17 single family permits: 15,291 Source: Credit Suisse; Census Bureau, Builder Magazine, Metrostudy, Company Data Note: Indexes above 5 indicate exceeds expectations or higher Slide 6 17 Austin as a % of Total 1 D.R. Horton 2, % 5.% 2 Lennar Corp. 1, % 3.5% 3 KB Home 1,17 6.8% 9.3% 4 PulteGroup % 4.2% 5 Milestone Community Builders % 6 Meritage Homes % 7.6% 7 Pacesetter Homes % 8 Gehan Homes % 9 Taylor Morrison % 5.8% Top 9 Totals 8, %

7 Buyer Index Baltimore, MD % 8% 6% % % % <5 - Below Expectations; =5 - Meets Expectations; >5 - Exceeds Expectations <5 - Lower than Prior Month; =5 - Flat vs Prior Month; >5 - Higher than Prior Month How Do the Recent 3 Days Compare to the Prior 3 Days... 13% 63% 25% 5% 13% 38% Note: Baltimore was excluded from March survey results due to lack of respondents 88% 13% % 75% 25% 29% 14% % 57% The Buyer Index declined to 31 from 5 in 17: Likely due to limited available inventory, sellers are hesitant to list properties. The Hom e Price Index increased to 44 from 38 last year. Sellers are hesitant to list unless absolutely necessary. Pent-up demand from lack of available inventory. Loan rates higher than in recent years. Interest rate increases and the government shutdown. Holidays and market fluctuations. Unseasonably warm weather. 32 nd largest market in the country 17 single family permits: 4,916 Source: Credit Suisse; Census Bureau, Builder Magazine, Metrostudy, Company Data Note: Indexes above 5 indicate exceeds expectations or higher Slide 7 17 Baltimore as a % of Total 1 NVR 1, % 8.9% 2 Lennar Corp % 1.6% 3 Beazer Homes USA % 4 Hovnanian Enterprises % 3.% 5 Richmond American Homes % 6 Toll Brothers % 1.7% 7 PulteGroup %.5% 8 Brookfield Homes 4 2.4% 9 Bob Ward Companies % Top 9 Totals 3, %

8 Buyer Index Boston, MA <5 - Below Expectations; =5 - Meets Expectations; >5 - Exceeds Expectations <5 - Lower than Prior Month; =5 - Flat vs Prior Month; >5 - Higher than Prior Month The Buyer Index rose to 32 from 13 last year: Although activity was below expectations, agent commentary centered on continued pent-up demand and mild weather. The Hom e Price Index decreased to 43 from 67 in Decem ber 17. More buyers than sellers. Rising rates and a fear of buying at the peak of the market. Demand still strong, although December is a slow month. Weather is cooperating. Higher interest rates, global economic uncertainty. Companies relocating into the area and milder weather. Lack of affordable inventory. 17 single family permits: 5,194 1% 8% 6% % % % How Do the Recent 3 Days Compare to the Prior 3 Days... 14% 57% 29% 36% % 64% 57% 43% % 83% 8% 8% 7% 5% 43% Source: Credit Suisse; Census Bureau, Builder Magazine, Metrostudy, Company Data Note: Indexes above 5 indicate exceeds expectations or higher Slide 8

9 Buyer Index Charleston, SC % 8% 6% % % % <5 - Below Expectations; =5 - Meets Expectations; >5 - Exceeds Expectations <5 - Lower than Prior Month; =5 - Flat vs Prior Month; >5 - Higher than Prior Month How Do the Recent 3 Days Compare to the Prior 3 Days... 1% 1% 5% 5% % % % Note: This market had been excluded from our survey from Nov 17 April 18 and Sept Oct 18 25% 75% % % % % 5% 5% The Buyer Index was 25 this month: Demand held below expectations given the holidays and a lack of available inventory. The Hom e Price Index cam e in at 25 in Decem ber. lackluster since September. Usually quiet from mid-november through the holidays. Contracts beginning to pick-up following a prolonged hurricane season. 29 th largest market in the country 17 single family permits: 4,71 Source: Credit Suisse; Census Bureau, Builder Magazine, Metrostudy, Company Data Note: Indexes above 5 indicate exceeds expectations or higher Slide 9 17 Charleston as a % of Total 1 Lennar Corp % 2.% 2 D.R. Horton % 1.2% 3 PulteGroup % 2.1% 4 Crescent Homes % 5 Beazer Homes % 5.1% 6 Dan Ryan Builders % 7 Ashton Woods Homes % 8 Mungo Homes % 9 Eastwood Homes % Top 9 Totals 3, %

10 Buyer Index Charlotte, NC % 8% 6% % % % <5 - Below Expectations; =5 - Meets Expectations; >5 - Exceeds Expectations <5 - Lower than Prior Month; =5 - Flat vs Prior Month; >5 - Higher than Prior Month How Do the Recent 3 Days Compare to the Prior 3 Days... 15% 5% 35% 1% 5% % 75% 35% 55% 15% 1% 1% 13% 47% % The Buyer Index increased to 42 from 33 last year: The move-down in rates corresponded with an increase in activity as prospective buyers looked to close before yearend. Continued relocations added to the traffic. The Hom e Price Index fell to from 75 in Dec 17. generally stronger. Still low inventory levels. Drop in rates and end-of-year spiked interest. Clients are very limited in their price ranges. Buyers trying to lock-in interest rates before year-end. Holidays and the government shutdown. Continued relocations leading to a busy December. 8 th largest market in the country 17 single family permits: 13,97 Source: Credit Suisse; Census Bureau, Builder Magazine, Metrostudy, Company Data Note: Indexes above 5 indicate exceeds expectations or higher Slide 1 17 Charlotte as a % of Total 1 Lennar Corp. 1, % 4.2% 2 D.R. Horton 1, % 2.6% 3 True Homes % 4 PulteGroup % 3.7% 5 NVR % 4.3% 6 AV Homes % 21.% 7 M/I Homes % 9.4% 8 Eastwood Homes % 9 LGI Homes % 6.1% Top 9 Totals 7, %

11 Buyer Index Chicago, IL % 8% 6% % % % 8% <5 - Below Expectations; =5 - Meets Expectations; >5 - Exceeds Expectations <5 - Lower than Prior Month; =5 - Flat vs Prior Month; >5 - Higher than Prior Month How Do the Recent 3 Days Compare to the Prior 3 Days... 5% 43% 39% 37% 24% 66% 52% 48% 48% 35% 24% 1% 13% 3% The Buyer Index decreased to 29 from in 17. The Hom e Price Index fell to 29 from 48 last Decem ber: Given several months of price declines, many buyers remain on the sidelines awaiting further reductions. Prices dropped slightly. Slowdown in the suburban luxury market slows the shift into downsizing or purchase of a second home/urban condo. Lack of properties available to first time buyers. Buyers on the sidelines waiting for a rate or price decline. Rushing to buy before interest rate increases. Rates ticked down and buyers see an opportunity in the colder months for a deal. 21 st largest market in the country 17 single family permits: 8,367 Chicago as a % 17 of Total 1 Lennar Corp % 1.7% 2 D.R. Horton 6 9.3% 1.3% 3 PulteGroup % 2.1% 4 M/I Homes 4 6.5% 8.3% 5 Olthof Homes % 6 Hovnanian Enterprises % 4.4% 7 Providence Real Estate Development 3.1% 8 Taylor Morrison % 1.5% 8 NVR %.8% 1 Lexington Homes % Top 1 Totals 3, % Source: Credit Suisse; Census Bureau, Builder Magazine, Metrostudy, Company Data Note: Indexes above 5 indicate exceeds expectations or higher Slide 11

12 Buyer Index Cincinnati, OH % 8% 6% % % % <5 - Below Expectations; =5 - Meets Expectations; >5 - Exceeds Expectations <5 - Lower than Prior Month; =5 - Flat vs Prior Month; >5 - Higher than Prior Month How Do the Recent 3 Days Compare to the Prior 3 Days... % 75% 5% 25% 25% 25% 25% 25% 5% 25% 75% % % 25% 75% Note: October 17 results were excluded due to lack of respondents The Buyer Index lowered to 1 from 17 in Dec 17: Rates and general macro uncertainty coupled with the holiday season drove traffic levels below agents expectations. The Hom e Price Index decreased to 38 from 58 last year. uncertainty. Interest rates. Broad negative housing news in the media. 43 rd largest market in the country 17 single family permits: 4,425 Source: Credit Suisse; Census Bureau, Builder Magazine, Metrostudy, Company Data Note: Indexes above 5 indicate exceeds expectations or higher Slide Cincinnati as a % of Total 1 The Fischer Group % 2 NVR % 3.7% 3 The Drees Co % 4 M/I Homes % 6.6% 5 Maronda Homes % 6 Arlinghaus Builders % 7 Hills Communities % 8 Cristo Homes % 9 Ashford Homes % 1 Meridian Mark % Top 1 Totals 2, %

13 Buyer Index Columbus, OH % 8% 6% % % % <5 - Below Expectations; =5 - Meets Expectations; >5 - Exceeds Expectations <5 - Lower than Prior Month; =5 - Flat vs Prior Month; >5 - Higher than Prior Month How Do the Recent 3 Days Compare to the Prior 3 Days... 46% 31% 23% 38% 38% 23% 46% 46% 8% 9% 9% 18% 9% Note: This market had been excluded from our survey from Nov 17 April 18 82% 73% The Buyer Index was 5 this month: Demand met agents expectations largely led by serious buyers willing to move over the holidays. The Hom e Price Index cam e in at 54 in Decem ber. More buyers willing to move over the holidays if the right house becomes available. Columbus opened a new opportunity zone with deferred taxes, leading to increased investor confidence and activity. Slower demand than a normal December. Continued low inventory levels. Buyers looking for move-in ready homes at fixer-upper prices. 39 th largest market in the country 17 single family permits: 4,166 Source: Credit Suisse; Census Bureau, Builder Magazine, Metrostudy, Company Data Note: Indexes above 5 indicate exceeds expectations or higher Slide Columbus as a % of Total 1 PulteGroup % 3.3% 2 M/I Homes % 9.3% 3 The Fischer Group % 4 Westport Homes % 5 Epcon Communities Franchising % 6 Rockford Homes % 7 NVR % 1.3% 8 Maronda Homes % 9 Village Communities % 1 Homewood Homes % Top 1 Totals 2, %

14 Buyer Index Dallas, TX % 8% 6% % % % <5 - Below Expectations; =5 - Meets Expectations; >5 - Exceeds Expectations <5 - Lower than Prior Month; =5 - Flat vs Prior Month; >5 - Higher than Prior Month How Do the Recent 3 Days Compare to the Prior 3 Days... 7% 53% % 27% 47% 27% 73% 27% 57% 43% % % % 64% 36% The Buyer Index rose to from 3 last year: Despite improved traffic, buyers lack a sense of urgency with the majority of agents noting an increase in the length of time needed to sell a home. The Hom e Price Index fell to 27 from 65 in the prior year. Buyers looking for bargains and waiting until they can get a good deal. Clients have no sense of urgency. Many homes are seeing price reductions and are staying on the market longer. Holidays and above average rainfall. Appears the market is making a correction in pricing. Reduced mortgage rates and improved inventory levels. Largest market in the country 17 single family permits: 34,461 Source: Credit Suisse; Census Bureau, Builder Magazine, Metrostudy, Company Data Note: Indexes above 5 indicate exceeds expectations or higher Slide Dallas as a % of Total 1 D.R. Horton 4, % 1.3% 2 Lennar Corp. 2, % 5.3% 3 Highland Homes 1, % 4 PulteGroup 1,32 4.2% 6.2% 5 Bloomfield Homes 1,26 4.% 6 First Texas Homes % 7 HistoryMaker Homes % 8 LGI Homes % 14.3% 9 Megatel Homes % Top 9 Totals 15, %

15 Buyer Index Denver, CO % 8% 6% % % % <5 - Below Expectations; =5 - Meets Expectations; >5 - Exceeds Expectations <5 - Lower than Prior Month; =5 - Flat vs Prior Month; >5 - Higher than Prior Month How Do the Recent 3 Days Compare to the Prior 3 Days... 57% 43% 29% 29% 29% 14% 71% 29% 71% 29% 25% % % 5% 25% The Buyer Index fell to 36 from 58 last year: Sequentially, activity improved in December following a soft autumn market. The Hom e Price Index declined to 43 from 66 in Decem ber 17. Steady activity considering the holidays. Saw a steep slowdown in the Fall, but increased activity over the past month. Fewer new listings and price reductions. Holiday season and interest rates. Prices still high. 14 th largest market in the country 17 single family permits: 1,933 Source: Credit Suisse; Census Bureau, Builder Magazine, Metrostudy, Company Data Note: Indexes above 5 indicate exceeds expectations or higher Slide Denver as a % of Total 1 Lennar Corp. 1, % 2.9% 2 M.D.C. Holdings 1, % 21.3% 3 Century % Communities 19.2% 4 KB Home % 5.7% 5 Oakwood Homes % 6 Meritage Homes % 5.7% 7 D.R. Horton %.9% 8 Shea Homes % 9 Taylor Morrison % 3.1% Top 9 Totals 5, %

16 Buyer Index Detroit, MI % 8% 6% % % % % <5 - Below Expectations; =5 - Meets Expectations; >5 - Exceeds Expectations <5 - Lower than Prior Month; =5 - Flat vs Prior Month; >5 - Higher than Prior Month How Do the Recent 3 Days Compare to the Prior 3 Days... 48% 52% % 55% 25% 67% 56% 33% 24% 1% 11% % 39% 61% The Buyer Index ticked down to 26 from 28 last year: Activity held below expectations given macro uncertainties and fatigued buyers opting to rent. The Hom e Price Index declined to 24 from 47 in Decem ber 17. Shortage of homes for sale, holidays and rising rates. Economic uncertainty with GM announcing plant closure. Aggressive published incentives by homebuilders. Many fatigued buyers left the market and signed leases. Some getting a head start before the spring season. Interest rates and negative news contributing to a lack of consumer confidence. Milder winter and lack of available inventory. 41 st largest market in the country 17 single family permits: 6,613 Detroit as a % 17 of Total 1 PulteGroup 628.% 3.% 2 Lombardo Homes % 3 Pinnacle Homes % 4 MJC Cos % 5 Infinity Homes % 6 Toll Brothers % 2.1% 7 Robertson Brothers Corp % 8 Clearview Homes % 9 Hunter Pasteur Homes % 1 Allen Edwin Homes % Top 1 Totals 2, % Source: Credit Suisse; Census Bureau, Builder Magazine, Metrostudy, Company Data Note: Indexes above 5 indicate exceeds expectations or higher Slide 16

17 Buyer Index Fort Myers, FL % 8% 6% % % % 13% <5 - Below Expectations; =5 - Meets Expectations; >5 - Exceeds Expectations <5 - Lower than Prior Month; =5 - Flat vs Prior Month; >5 - Higher than Prior Month How Do the Recent 3 Days Compare to the Prior 3 Days... 5% 38% 25% 63% 13% 63% 38% 5% 5% 5% 38% % % 13% The Buyer Index increased to 44 from 39 in Dec 17: Activity picked-up in the MSA as snowbirds begin to reenter the housing market. The Hom e Price Index lowered to 31 from 67 in the prior year. Seeing seasonal traffic. Red-tide algae fears have faded for now and cold weather returned up North. Weather conditions in the North. 35 th largest market in the country 17 single family permits: 4,798 Ft. Myers as a % 17 of Total 1 Lennar Corp % 2.3% 2 D.R. Horton % 1.7% 3 PulteGroup % 2.% 4 LGI Homes % 4.% 5 Neal Communities of Southwest Florida % 6 Wade Jurney Homes % 7 GL Homes % 8 Adams Homes % 9 Stock Development 71 2.% 1 Taylor Morrison %.8% Top 1 Totals 3, % Source: Credit Suisse; Census Bureau, Builder Magazine, Metrostudy, Company Data Note: Indexes above 5 indicate exceeds expectations or higher Slide 17

18 Buyer Index Houston, TX % 8% 6% % % % <5 - Below Expectations; =5 - Meets Expectations; >5 - Exceeds Expectations <5 - Lower than Prior Month; =5 - Flat vs Prior Month; >5 - Higher than Prior Month How Do the Recent 3 Days Compare to the Prior 3 Days... 15% 54% 31% 38% 31% 31% 77% 23% 31% 69% % % % 55% 45% The Buyer Index lowered to 27 from 42 in Dec 17: Despite traffic below expectations, agents remain optimistic about the spring selling season. The Hom e Price Index decreased to 42 from 46 in the prior year. Always a slow period between Thanksgiving and Christmas. Rising home prices and rates are constraining affordability. General economic and political uncertainty. Expect traffic to pick up in January, February and March. Interest rates and the price of oil. 2 nd largest market in the country 17 single family permits: 39,14 Source: Credit Suisse; Census Bureau, Builder Magazine, Metrostudy, Company Data Note: Indexes above 5 indicate exceeds expectations or higher Slide Houston as a % of Total 1 D.R. Horton 2, % 5.5% 2 Lennar Corp. 2, % 5.1% 3 Perry Homes 1, % 4 Hovnanian Enterprises 1,4 4.8% 22.6% 5 Long Lake Limited 1,96 4.3% 6 Taylor Morrison % 13.4% 7 KB Home % 9.8% 8 PulteGroup % 4.5% 9 Meritage Homes % 11.7% 9 LGI Homes % 15.4% Top 1 Totals 13, %

19 Buyer Index Indianapolis, IN % 8% 6% % % % <5 - Below Expectations; =5 - Meets Expectations; >5 - Exceeds Expectations <5 - Lower than Prior Month; =5 - Flat vs Prior Month; >5 - Higher than Prior Month How Do the Recent 3 Days Compare to the Prior 3 Days... % 83% 17% 33% 17% 5% 5% 5% 5% Note: Indianapolis was excluded from August 18 results due to lack of respondents 5% % % 33% 17% 5% The Buyer Index rose to 42 from 25 last year: Encouraged by a strong local economy, prospective buyers are returning to the market ahead of the selling season. The Hom e Price Index fell to 42 from 63 in Dec 17. Buyers ready to start looking into the spring season. Interest rates and a lack of inventory. Holidays and interest rates. Strong local economy. 24 th largest market in the country 17 single family permits: 6,224 Source: Credit Suisse; Census Bureau, Builder Magazine, Metrostudy, Company Data Note: Indexes above 5 indicate exceeds expectations or higher Slide Indianapolis as a % of Total 1 Arbor Homes % 2 Lennar Corp % 1.8% 3 PulteGroup % 3.7% 4 Westport Homes % 5 The Fischer Group % 6 M/I Homes % 7.3% 7 Beazer Homes % 5.1% 8 NVR % 1.% 9 The Drees Co % 1 Davis Building Group % Top 1 Totals 4, %

20 Buyer Index Jacksonville, FL % 8% 6% % % % % <5 - Below Expectations; =5 - Meets Expectations; >5 - Exceeds Expectations <5 - Lower than Prior Month; =5 - Flat vs Prior Month; >5 - Higher than Prior Month How Do the Recent 3 Days Compare to the Prior 3 Days... % % 6% 5% % % 3% 3% % % 1% 29% % 71% The Buyer Index rose to 35 from 25 last year. The Hom e Price Index decreased to from 56 in the prior year: Notably, agents saw home prices lower sequentially for the first time in the last 18 months. Buyers returning to the market following the hurricanes. Lack of available inventory. Lots of buyers out and looking. Increased employment opportunities. typically slows in December due to the holidays. th largest market in the country 17 single family permits: 9,824 Source: Credit Suisse; Census Bureau, Builder Magazine, Metrostudy, Company Data Note: Indexes above 5 indicate exceeds expectations or higher Slide 17 Jacksonville as a % of Total 1 D.R. Horton 1, % 3.8% 2 Lennar Corp % 2.1% 3 Dream Finders Homes % 4 Mattamy Homes % 5 KB Home % 4.3% 6 PulteGroup % 1.7% 7 David Weekley Homes % 8 M.D.C. Holdings % 4.5% 9 ICI Homes 1 2.7% Top 9 Totals 5, %

21 Buyer Index Kansas City, MO % 8% 6% % % % <5 - Below Expectations; =5 - Meets Expectations; >5 - Exceeds Expectations <5 - Lower than Prior Month; =5 - Flat vs Prior Month; >5 - Higher than Prior Month How Do the Recent 3 Days Compare to the Prior 3 Days... % 57% 43% 43% 29% 29% 5% 5% 17% 83% % % % 33% 67% The Buyer Index fell to 36 from 8 in the prior year: Agents noted buyers waiting for spring compared to the prior year s heightened December activity. The Hom e Price Index fell to 29 from 7 in Dec 17. Lack of inventory. Mortgage rate changes. Buyers waiting for taxes to be filed and Spring to start. Holiday season. 33 rd largest market in the country 17 single family permits: 5,9 Source: Credit Suisse; Census Bureau, Builder Magazine, Metrostudy, Company Data Note: Indexes above 5 indicate exceeds expectations or higher Slide Summit Custom Homes % 2 Prieb Homes 27 7.% 3 James Engle Custom Homes % 4 Johnnie Adams Homes % 5 Don Julian Builders 1 2.6% 6 Rodrock Homes % 7 Robertson Construction % 8 SAB Construction 78 2.% 9 Hearthside Homes of Kansas City % 1 Integrity Homebuilders % Top 1 Totals 1, % Kansas City as a % of Total

22 Buyer Index Las Vegas, NV % 8% 6% % % % <5 - Below Expectations; =5 - Meets Expectations; >5 - Exceeds Expectations <5 - Lower than Prior Month; =5 - Flat vs Prior Month; >5 - Higher than Prior Month How Do the Recent 3 Days Compare to the Prior 3 Days... % 8% 6% 8% % % % % % 6% % % % % 6% The Buyer Index declined to 1 from 62 last year: Agents are seeing affordability constraints beginning to temper demand levels. The Hom e Price Index fell to 1 from 88 in Dec 17. Pricing and rates have driven the low and median prospective buyers out of the market. Higher rates are preventing buyers from moving forward with home ownership. Weather impacts the market. Lack of entry level inventory. Holidays and an increase in properties for sale. 15 th largest market in the country 17 single family permits: 9,7 Source: Credit Suisse; Census Bureau, Builder Magazine, Metrostudy, Company Data Note: Indexes above 5 indicate exceeds expectations or higher Slide Las Vegas as a % of Total 1 Lennar Corp. 1, % 3.6% 2 D.R. Horton 1, % 2.6% 3 KB Home 1, % 9.3% 4 M.D.C. Holdings % 15.7% 5 American West Homebuilding Group % 6 PulteGroup % 2.9% 7 Century Communities % 14.3% 8 TRI Pointe Group % 1.2% 9 Woodside Homes % Top 9 Totals 7, %

23 Buyer Index Los Angeles, CA % 8% 6% % % % <5 - Below Expectations; =5 - Meets Expectations; >5 - Exceeds Expectations <5 - Lower than Prior Month; =5 - Flat vs Prior Month; >5 - Higher than Prior Month How Do the Recent 3 Days Compare to the Prior 3 Days... % % 6% 38% 19% 44% 88% 13% % 54% 38% 8% 7% 33% 6% The Buyer Index fell to 28 from 43 in Dec 17. The Hom e Price Index declined to from 64 last year: Although prices are moderating, minimal supply below $45k is driving elongated days on market. Buyers waiting and watching the market. Typically slow during the holidays will likely pick back up in March. Less affordable inventory (mid-$k) on the market. Time of year and rates. 17 th largest market in the country 17 single family permits: 1,436 Source: Credit Suisse; Census Bureau, Builder Magazine, Metrostudy, Company Data Note: Indexes above 5 indicate exceeds expectations or higher Slide Los Angeles as a % of Total 1 The Irvine Co % 2 Lennar Corp % 1.8% 3 KB Home % 6.2% 4 Toll Brothers % 6.2% 5 Shea Homes 4 5.1% 6 TRI Pointe Group % 9.3% 7 California Pacific Homes % 8 William Lyon Homes % 1.9% 9 Brookfield Homes % Top 9 Totals 4, %

24 Buyer Index Miami, FL % 8% 6% % % % <5 - Below Expectations; =5 - Meets Expectations; >5 - Exceeds Expectations <5 - Lower than Prior Month; =5 - Flat vs Prior Month; >5 - Higher than Prior Month How Do the Recent 3 Days Compare to the Prior 3 Days... 12% 53% 35% 53% 35% 59% 29% 5% 36% 12% 12% 14% 12% 47% 41% The Buyer Index declined to 24 from 33 last Dec: Broad-based macro uncertainty and higher rates are discouraging prospective buyers. The Hom e Price Index lowered to 38 from 5 last year. High inventory in the luxury market. Interest rates are negatively impacting starter home traffic, while the volatile stock market kept high-end buyers on the fence. Foreign relations turmoil and macro economic uncertainty. Concern over headline reports regarding housing combined with interest rates and insurance concerns. Increase in cash buyers. 11 th largest market in the country 17 single family permits: 6,494 Source: Credit Suisse; Census Bureau, Builder Magazine, Metrostudy, Company Data Note: Indexes above 5 indicate exceeds expectations or higher Slide Miami - Ft. Lauderdale as a % of Total 1 Lennar Corp. 2, % 6.% 2 The Related Group 1, % 3 D.R. Horton % 1.6% 4 GL Homes % 5 Eastview Development % 6 Key International 38 4.% 7 Century Homebuilders % 8 Hovnanian % Enterprises 4.2% 9 Plaza Equity Partners 7 2.2% Top 9 Totals 6, %

25 Buyer Index Minneapolis, MN % 8% 6% % % % <5 - Below Expectations; =5 - Meets Expectations; >5 - Exceeds Expectations <5 - Lower than Prior Month; =5 - Flat vs Prior Month; >5 - Higher than Prior Month How Do the Recent 3 Days Compare to the Prior 3 Days... 42% 46% 48% 3% 22% 12% 88% 8% 4% 16% 72% 12% 3% 22% 48% The Buyer Index declined to 35 from 44 in the prior year: The majority (88%) saw homes take longer to sell, with agents looking towards spring. The Hom e Price Index lowered to 33 from 69 in Dec 17. Interest rates have eased and warmer weather gets buyers out and looking. Lack of inventory and the 2-3 week holiday period. Low levels of supply, higher rents and uptick in construction costs. January will likely be the start of the spring market. Multiple offers are in play already. 22 nd largest market in the country 17 single family permits: 8,6 Source: Credit Suisse; Census Bureau, Builder Magazine, Metrostudy, Company Data Note: Indexes above 5 indicate exceeds expectations or higher Slide Minneapolis as a % of Total 1 Lennar Corp. 1, % 2.7% 2 PulteGroup % 2.2% 3 D.R. Horton %.9% 4 M/I Homes % 4.9% 5 Mattamy Homes % 6 Capstone Homes 7 3.7% 7 Robert Thomas Homes % 8 R Home % 9 Hanson Builders % Top 9 Totals 3, %

26 Buyer Index Nashville, TN % 8% 6% % % % <5 - Below Expectations; =5 - Meets Expectations; >5 - Exceeds Expectations <5 - Lower than Prior Month; =5 - Flat vs Prior Month; >5 - Higher than Prior Month How Do the Recent 3 Days Compare to the Prior 3 Days... 5% 5% % 3% % 1% 7% % 1% 11% 89% % % 5% 5% The Buyer Index was unchanged at 5 YOY. The Hom e Price Index fell to 35 from 63 in Dec 17: Price reductions and improving weather led to traffic levels holding steady year over year. Local weather has been warmer than prior years and a slight dip in interest rates. Still a shortage of mid-level housing. Overall market has changed and balanced out more. December foot traffic improving considering the weather was a little better. is reverting to more normalized levels. 13 th largest market in the country 17 single family permits: 12,719 Top 1 Builders Nashville as a % 17 of Total 1 Ole South Properties % 2 NVR % 4.1% 3 Goodall Homes % 4 Regent Homes % 5 Beazer Homes % 5.2% 6 PulteGroup % 1.3% 7 Lennar Corp %.5% 8 Signature Homes 3 2.3% 9 The Jones Company of Tennessee % 1 The Drees Co % Top 1 Totals 3, % Source: Credit Suisse; Census Bureau, Builder Magazine, Metrostudy, Company Data Note: Indexes above 5 indicate exceeds expectations or higher Slide 26

27 Buyer Index New York Northern NJ % 8% 6% % % % <5 - Below Expectations; =5 - Meets Expectations; >5 - Exceeds Expectations <5 - Lower than Prior Month; =5 - Flat vs Prior Month; >5 - Higher than Prior Month How Do the Recent 3 Days Compare to the Prior 3 Days... 5% 46% 49% 44% 31% 26% 66% 32% 2% 31% 57% 11% 15% 45% % The Buyer Index rose to 38 from 34 in the prior year: Although still below expectations, activity improved this month given lowered prices and rates. The Hom e Price Index fell to 28 from 61 in Dec 17. Some buyers are waiting it out until spring and more homes come on the market. Bargain hunters seem to be out. Combination of lower rates and stable/reduced prices. Buyers needing to move are causing a traffic uptick following a Fall of minimal inventory. Buyers scrambling before interest rates rise further. 1 th largest market in the country 17 single family permits: 1,26 Source: Credit Suisse; Census Bureau, Builder Magazine, Metrostudy, Company Data Note: Indexes above 5 indicate exceeds expectations or higher Slide NY - Northern NJ - Long Island as a % of Total 1 Toll Brothers % 1.1% 2 ONEX % 3 Hovnanian Enterprises % 7.2% 4 PulteGroup % 1.6% 5 Lennar Corp %.5% 6 Magnum Real Estate Group % 7 Greenland USA % 8 NVR % 1.1% 9 Flushing Commons Property Owner, LLC 1 1.4% 1 Elad Group and Silverstein Properties % Top 1 Totals 2, %

28 Buyer Index Orlando, FL % 8% 6% % % % <5 - Below Expectations; =5 - Meets Expectations; >5 - Exceeds Expectations <5 - Lower than Prior Month; =5 - Flat vs Prior Month; >5 - Higher than Prior Month How Do the Recent 3 Days Compare to the Prior 3 Days... % % % 53% 27% % 67% 27% 7% % 67% 13% % 31% 69% The Buyer Index declined to 23 from 44 in Dec 17: Wavering consumer confidence combined with the holiday slowdown led to open house traffic below expectations. The Hom e Price Index fell to from 59 last year. Lack of land at reasonable prices. Typical seasonal decline in traffic. Bumpy stock market, government shutdown and associated political uncertainty. Lack of inventory, interest rates and holidays. 6 th largest market in the country 17 single family permits: 14,951 Source: Credit Suisse; Census Bureau, Builder Magazine, Metrostudy, Company Data Note: Indexes above 5 indicate exceeds expectations or higher Slide Orlando as a % of Total 1 Lennar Corp. 2,629.7% 6.% 2 D.R. Horton 1,49 8.3% 2.2% 3 The Villages of Lake Sumter % 4 PulteGroup % 3.7% 5 Meritage Homes % 8.4% 6 AV Homes % 25.5% 7 Mattamy Homes % 8 Taylor Morrison % 6.7% 9 KB Home % 4.5% Top 9 Totals 8, %

29 Buyer Index Philadelphia Southern NJ % 8% 6% % % % <5 - Below Expectations; =5 - Meets Expectations; >5 - Exceeds Expectations <5 - Lower than Prior Month; =5 - Flat vs Prior Month; >5 - Higher than Prior Month How Do the Recent 3 Days Compare to the Prior 3 Days... 8% 69% 23% 31% 15% 54% 54% 38% 8% 17% 83% % % 18% 82% The Buyer Index ticked down to 35 from 38 in 17: Limited available supply combined with the holiday slowdown kept traffic below agents expectations. The Hom e Price Index cam e in lower at 42 vs 82 last Decem ber. Seasonally slow combined with rising rates and low inventory. Lack of inventory means buyers are looking but can t find anything at the moment. Holidays and inclement weather. Buyers didn t find anything before the holiday season and are now anxious to get going again. 27 th largest market in the country 17 single family permits: 7,136 Source: Credit Suisse; Census Bureau, Builder Magazine, Metrostudy, Company Data Note: Indexes above 5 indicate exceeds expectations or higher Slide Philadelphia as a % of Total 1 NVR 1, % 7.7% 2 Toll Brothers % 9.2% 3 Lennar Corp % 1.2% 4 D.R. Horton %.4% 5 PulteGroup %.7% 6 W.B. Homes 1 1.9% 7 T.H. Properties % 8 Hovnanian Enterprises % 1.7% 9 V2 Properties 8 1.6% Top 9 Totals 3, %

30 Buyer Index Phoenix, AZ % 8% 6% % % % <5 - Below Expectations; =5 - Meets Expectations; >5 - Exceeds Expectations <5 - Lower than Prior Month; =5 - Flat vs Prior Month; >5 - Higher than Prior Month How Do the Recent 3 Days Compare to the Prior 3 Days... % 64% 36% 24% 52% 24% 72% 24% 35% 61% 4% 4% % 52% 48% The Buyer Index fell to 26 from 54 last year: The majority (72%) saw a greater than expected length of time needed to sell as buyers lack a sense of urgency. The Hom e Price Index lowered to 32 from 65 in Dec 17. Fewer buyers and unrealistic selling price expectations. Holiday season, poor weather and macro uncertainty. Buyers nervous about the economy and rising rates. Continuing influx from California. Lack of urgency to purchase. Buyers looking for move-in ready homes. 4 th largest market in the country 17 single family permits:,455 Source: Credit Suisse; Census Bureau, Builder Magazine, Metrostudy, Company Data Note: Indexes above 5 indicate exceeds expectations or higher Slide 3 17 Phoenix as a % of Total 1 Lennar Corp. 2, 11.5% 4.6% 2 D. R. Horton 1, % 3 Meritage Homes 1, % 16.8% 4 Taylor Morrison 1, % 14.7% 5 PulteGroup 1, % 5.4% 6 Fulton Homes % 7 Shea Homes % 8 KB Home % 5.4% 9 Richmond American Homes % Top 9 Totals 1, %

31 Buyer Index Portland, OR % 8% 6% % % % 5% <5 - Below Expectations; =5 - Meets Expectations; >5 - Exceeds Expectations <5 - Lower than Prior Month; =5 - Flat vs Prior Month; >5 - Higher than Prior Month How Do the Recent 3 Days Compare to the Prior 3 Days... 32% 63% 37% 37% 26% 89% 11% 39% 61% % % % 76% 24% The Buyer Index decreased to 29 from 35 in 17. The Hom e Price Index lowered to 21 from 61 in the prior year: As prices moderate, agents are seeing increased inventory at the first-time buyer price points ($3-$5k). Cycle seems more normal at this time. Seeing a little more inventory in the first-time buyer price range ($3-$5k). Only serious buyers are out and looking December allows them to purchase with less competition. Buyers have become less urgent and want time to think before making an offer. Slowing caused by rising rates limiting purchasing ability. 28 th largest market in the country 17 single family permits: 6,814 Portland as a % 17 of Total 1 D.R. Horton % 1.8% 2 William Lyon Homes % 23.1% 3 Lennar Corp %.9% 4 New Tradition Homes % 5 Pahlisch Homes % 6 Pacific Lifestyle Homes % 7 Stone Bridge Homes NW % 8 Urban NW Homes % 9 Everett Custom Homes 9 1.8% 1 Manor Homes % 1 Renaissance Custom Homes % Top 11 Totals 2, % Source: Credit Suisse; Census Bureau, Builder Magazine, Metrostudy, Company Data Note: Indexes above 5 indicate exceeds expectations or higher Slide 31

32 Buyer Index Raleigh, NC % 8% 6% % % % % <5 - Below Expectations; =5 - Meets Expectations; >5 - Exceeds Expectations <5 - Lower than Prior Month; =5 - Flat vs Prior Month; >5 - Higher than Prior Month How Do the Recent 3 Days Compare to the Prior 3 Days... 56% 44% 47% 33% % 6% 64% % % 21% 14% % 55% 45% The Buyer Index decreased to 47 from 6 in 17: Given anticipated slower traffic around the holidays, activity levels roughly met agents expectations. The Hom e Price Index lowered to 28 from 9 last year. Moderate inventory and prices staying level. Potential sellers already getting ready for the spring market. Interest rates still historically low. Holiday distractions. General price fatigue in the face of builders increases. Expected slow traffic patterns around the holidays. 18 th largest market in the country 17 single family permits: 1,785 Raleigh as a % 17 of Total 1 Lennar Corp % 2.2% 2 Dan Ryan Builders % 3 PulteGroup % 2.3% 4 M/I Homes % 7.8% 5 Royal Oaks Building Group % 6 D.R. Horton %.7% 7 Terramor Homes % 8 Taylor Morrison 2 2.7% 2.7% 8 Mungo Homes 2 2.7% Top 9 Totals 3, % Source: Credit Suisse; Census Bureau, Builder Magazine, Metrostudy, Company Data Note: Indexes above 5 indicate exceeds expectations or higher Slide 32

33 Buyer Index Sacramento, CA % 8% 6% % % % <5 - Below Expectations; =5 - Meets Expectations; >5 - Exceeds Expectations <5 - Lower than Prior Month; =5 - Flat vs Prior Month; >5 - Higher than Prior Month How Do the Recent 3 Days Compare to the Prior 3 Days... % 27% 73% 27% 18% 55% 73% 27% 56% 44% 45% 45% % % 9% The Buyer Index decreased to 41 from 65 in the prior Decem ber. The Hom e Price Index fell to 14 from 65 last year: As prices continue to level, buyers are cautiously returning to the market. A very slow September and October makes the traffic levels feel higher. Pricing has leveled off with no multiple offer or bidding war situations. Buyers out and looking but lack of available inventory. Concern over rising rates. Sellers are waiting and buyers are keeping an eye. 23 rd largest market in the country 17 single family permits: 6,854 Source: Credit Suisse; Census Bureau, Builder Magazine, Metrostudy, Company Data Note: Indexes above 5 indicate exceeds expectations or higher Slide Sacramento as a % of Total 1 Lennar Corp. 1, % 2.8% 2 Taylor Morrison 9 7.4% 5.1% 3 KB Home % 3.6% 4 Woodside Homes % 5 Hovnanian Enterprises % 5.5% 6 Elliott Homes % 7 JMC Homes % 8 D.R. Horton %.6% 9 Beazer Homes % 4.3% Top 9 Totals 3, %