CHART 2 - N. Kona Residential Median Price vs Number Sold Since 1997

GRIGGS REPORT #198 - October 31, 215 A TWICE MONTHLY REAL ESTATE MARKET PERSPECTIVE FOR NORTH KONA AND HAWAII ISLAND PAGE 1 NORTH KONA RESIDENTIAL DATA ABOUT THE PENDING RATIO:: The Pending Ratio is used throughout the report to serve as an indicator of Market Strength and Market Trend.. PENDING RATIO = NUMBER OF PENDING SALES DIVIDED BY ACTIVE LISTING TIMES 1. THE HIGHER RATIO = STRONGER MARKET DEMAND vs. SUPPLY. Why it is a useful indicator: 1) It is a current leading indicator of market Demand vs. Supply Dynamics based on Pending Sales (Ac & U) and Active listings (A) from MLS Data. 2) It is a readily available useful indication or market strength when tracked over time it shows market trend. 3) It can be used as a "Litmus Test" of market strength for any market niche with sufficient MLS active listing and pending sales data. PEAK MARKET - Signals the End of the Real Estate Cycle is eminent PENDING RATIO 1 or GREATER PEAK SELLERS MARKET - PENDING RATIO FROM 51 TO 99 SELLER'S NEUTRAL OR STABLE MARKET - PENDING RATIO FROM 3 TO NEUTRAL BUYERS MARKET - PENDING RATIO BELOW 3 BUYER'S NORTH KONA RESIDENTIAL DATA TABLE TABLE 1 ACTIVE PENDING PENDING TYPE OF Number Sold Average VOLUME Median # SOLD to $4M LISTINGS SALES RATIO MARKET 12 Month Period Price MILLIONS Price Last 3 days 1/31/1997 336 no data no data 241 $ 274,3 $ 66.1 $ 23, 23 1/31/1998 35 95 31.15 PRICE LOW >>>>>>>>> >>>>>>>> 318 $ 269,9 $ 85.8 $ 225, 41 1/31/1999 213 11 47.42 NEUTRAL 44 $ 34,4 $ 123. $ 24, 44 1/31/2 26 15 4.38 NEUTRAL 449 $ 354,4 $ 159.1 $ 275, 26 1/31/21 299 122 4.8 NEUTRAL 493 $ 351,3 $ 173.2 $ 267,1 49 1/31/22 no data no data no data no data 551 $ 368, $ 22.8 $ 3, 51 1/31/23 154 167 18.44 PEAK 595 $ 431,3 $ 256.6 $ 386, 77 1/31/24 147 16 18.84 DEMAND PEAK 717 $ 557,6 $ 399.8 $ 475, 71 1/31/25 22 143 65. SELLER'S 66 $ 78,8 $ 467.8 $ 66,9 54 1/31/26 339 56 16.52 PRICE PEAK >>>>>>>>> >>>>>>>> 522 $ 753,4 $ 393.3 $ 635, 3 1/31/27 44 59 14.6 BUYER'S 49 $ 736,8 $ 31.4 $ 61, 29 1/31/28 397 39 9.82 DEMAND LOW 269 $ 671, $ 18.5 $ 5, 15 1/31/29 367 85 23.16 BUYER'S 244 $ 526,4 $ 128.4 $ 431, 33 1/31/21 282 98 34.75 NEUTRAL 359 $ 472, $ 169.4 $ 399, 25 1/31/211 259 92 35.52 PRICE LOW >>>>>>>>> >>>>>>>> 392 $ 453,1 $ 177.6 $ 369, 28 1/31/212 199 12 6.3 SELLER'S 46 $ 487,1 $ 197.8 $ 385, 44 1/31/213 168 13 61.31 SELLER'S 468 $ 542,4 $ 253.8 $ 431, 28 1/31/214 188 79 42.2 NEUTRAL 419 $ 634,1 $ 265.7 $ 519, 26 1/31/215 22 7 34.65 NEUTRAL 4 $ 673,9 $ 33.3 $ 5, 45 14' vs 15' 7% -11% -18% 7% 6% 14% 6% 73% TABLE 1 & Chart 1- Median Price remains at $5, level. Escrow are off from this time last year. Closed sale continue to improve. Sales in the last 3 days are up 73% from last years count. The increase in inventory and drop in escrow number have caused the Pending Ratio to dip. This decline is seasonal, but none the less it is off from last year when prices were 6% lower. $6 $432 $439 $449 $465 $473 $488 $ $4 $3 $2 $1 The following Color Codes describe what the ratio numbers mean in terms of the type of market. Chart 1 - Kona Residential Median Price (thous) & Pending Ratio - Past 2 Years Res-Median Price $519 Res Pending Ratio $545 $545 $5 $5 $5 $549 $5 $552 $5 7 6 4 3 2 1 8 7 6 4 $23, $225, $24, 3 2 1 CHART 2 - N. Kona Residential Median Price vs Number Sold Since 1997 $475, $386, $275, $3, $267,1 Median Price $66,9 $635, Number Sold 12 Month Period $61, $7, $5, $519, $5, $6, $431, $399, $369, $385, $431, $, $4, $3, $2, $1,

PAGE 2 NORTH NORTH KONA KONA RESIDENTIAL RESIDENTIAL PRICE PRICE RANGE RANGE DATA DATA TABLE 2 KONA RESIDENTIAL NUMBER AVERAGE 65 $17,9 $1, $68,372 $74, $84,9 Number PRICE RANGE ACTIVE PRICE PENDING PRICE MILLIONS RATIO 214 215 GAIN or LOSS TO $ 4, 8 $ 322,4 19 $325,8 $ 6.2 237. 8 68 (12) $ 41, $, 13 $ 456,9 8 $ 465,7 $ 3.7 61.54 127 17 (2) $ 1, $ 7, 58 $ 63,6 24 $575,2 $ 13.8 41.38 17 142 35 $71, $ 9, 29 $789,3 7 $825,3 $ 5.8 24.14 51 68 17 $ 91, $ 1,, 6 $ 1,211,4 6 $ 1,28,2 $ 7.2 1. 46 45 (1) $1.5M $ 4.M 34 $ 2,169,8 6 $ 3,58,3 $ 18.3 17.65 12 22 1 $4.1 M or GREATER 36 $ 7,82, 3 $ 8,983,3 $ 26.9 8.33 19 18 (1) Table 2, The pie charts show that the year over year change in sales numbers increased the most in the $, to $7, price ranges. There is also a 2% increase in the $7, to $9, price range. 214 Percentage Sold by Price Range 215 Percentage Sold by Price Range 12% 1% 3% 4% 18% 29% TO $4, $41, $, $1, $7, $71, $9, $91, $1,, $1.5M $ 4.M $4.1 M or GREATER 14% 1% 5% 4% 14% 23% TO $4, $41, $, $1, $7, $71, $9, $91, $1,, $1.5M $ 4.M 24% 3% $4.1 M or GREATER BIG ISLAND LISTING, PENDING SALES AND SALES YEAR TO DATE NORTH KONA RESIDENTIAL PRICE RANGE DATA TABLE 3 HI ISLE RES NUMBER LOW HIGH AVERAGE MEDIAN MODE VOLUME (M) PENDING 3-1 TO 3-4 ACTIVE 67 $23, $6,9, $425,773 $289,4 N/A $ 285 RATIO ALL EAST HI PENDING 217 $35, $8,2, $35,698 $239, N/A $ 66 RESIDENTIAL SOLD YTD 848 $5,2 $3,291,667 $259,696 $23, $2, $ 22 32.39 3-5 TO 3-9 ACTIVE 67 $17,9 $35,, $1,582,936 $654, N/A $ 961 ALL WEST HI PENDING 177 $13, $24,, $944,346 $475, N/A $ 167 RESIDENTIAL SOLD YTD 848 $13, $25,, $698,251 $479, N/A $ 592 29.16 ALL HI ISLE ACTIVE 1277 $17,9 $35,, $975,98 $425, $599, $ 1,246 ALL HI ISLE PENDING 394 $13, $24,, $592,63 $299,6 N/A $ 233 3.85 ALL HI ISLE SOLD YTD 1696 $5,2 $25,, $479,6 $33, $2, $ 812 45 4 35 3 25 2 15 1 5 - CHART 4 - West HI, East HI and Hawaii Island - Residential Pending Ratio over the Past Two Years West Hawaii Ratio East Hawaii Ratio Big Isle Res Ratio CHART 4 - Hawaii Islands Pending Ratio shows a slight decreasing trend with this latest report data. This is a seasonal effect caused my more Active inventory being release on the market in anticipation of the busy winter season plus slight decline in Pending Sales.

PAGE 3 BIG ISLAND DISTRESSED RESIDENTIAL PROPERTIES TREND CHART 5 - Percentage of Total MLS Active, Pending or 9 sales Listings that are Short Sales or REO 25% 2% 15% 1% WAIKOLOA 3-6-8 WAIMEA 3-6-4,5,6 S HILO 3-2 PUNA 3-1 N. KONA 3-7 5% % 1/31/14 11/3/14 12/31/14 1/31/15 2/28/15 3/31/15 4/3/15 5/31/15 6/3/15 7/31/15 8/31/15 9/3/15 1/31/15 TABLE 4 COMPARES THE PERCENTAGE OF DISTRESSED MLS LISTINGS YEAR OVER YEAR AVERAGE N. KONA WAIKOLOA WAIMEA S. HILO PUNA HI ISLE 214 11% 8% 21% 13% 14% 13% 215 12% 7% 12% 1% 17% 12% % CHANGE 1% -1% -8% -3% 2% -2% CHART 5: The percentage of MLS listings that are Short Sales or REO is probably the best illustration of the distressed property trend. Better than the REO count in Chart 5, Table 5. Accept for Waikoloa the trend has toward increase in that last few months. The percentages are still relatively modest compared with the peak levels near 4% in late 211. Chart 6 - REO Properties By District, Total Number Held by: FANNIE MAE -- Deutsche Bank -- Wells Fargo -- Bank of America # of REO 7 Properties 6 4 Puna S Hilo 3 2 1 S Kohala N Kona S Kona, Kau TABLE 5 COMPARES THE NUMBER OF REO PROPERTIES YEAR OVER YEAR PUNA S. HILO NHILO,HAMAKUA N. KOHALA S. KOHALA N. KONA S. KONA,KAU TOTAL INCREASE 214 53 14 1 1 17 27 17 139 ISLAND 215 47 13 8 1 14 2 12 115 WIDE CHANGE -6-1 -2-3 -7-5 >>>>> -24 CHART 6: The REO count for the Lenders tracked hasn't changed much over the year. Keep in mind this does NOT represent the TOTAL REO counts around the island. This is merely a sampling of the TMK data for four lending institutions collected every two weeks to try define the Trend. Year over year numbers are down. All areas show very little change this year.

PAGE 4 NORTH KONA CONDO DATA TABLE 6 ACTIVE PENDING PENDING TYPE OF Number Sold AVERAGE VOLUME MEDIAN # SOLD to $1.5M RATIO MARKET 12 Month Period Price MILLIONS Price 3 days 1/31/1997 no data no data no data PRICE LOW >>>>>>>>>> >>>>>>>>> 296 $ 129,1 $ 38 $ 17, 32 1/31/1998 no data no data no data no data 376 $ 133,2 $ $ 115, 33 1/31/1999 225 46 2.44 BUYER'S 427 $ 14, $ 6 $ 126, 35 1/31/2 112 88 78.57 SELLER'S 495 $ 166,7 $ 83 $ 135, 4 1/31/21 197 47 23.86 NEUTRAL 437 $ 185,6 $ 81 $ 1, 49 1/31/22 no data no data no data no data 399 $ 2,6 $ 8 $ 173, 41 1/31/23 9 198 22. PEAK 616 $ 219,4 $ 135 $ 193, 53 1/31/24 79 173 218.99 DEMAND PEAK 587 $ 289,8 $ 17 $ 265, 59 1/31/25 194 124 63.92 SELLER'S 692 $ 41,2 $ 278 $ 369, 64 1/31/26 362 34 9.39 PRICE PEAK >>>>>>>>>> >>>>>>>>> 477 $ 459, $ 219 $ 415, 33 1/31/27 387 23 5.94 BUYER'S 283 $ 41,8 $ 114 $ 365, 21 1/31/28 3 17 4.86 DEMAND LOW 191 $ 379,4 $ 72 $ 3, 11 1/31/29 323 37 11.46 BUYER'S 148 $ 285, $ 42 $ 261,3 15 1/31/21 226 57 25.22 BUYER'S 272 $ 238,7 $ 65 $ 21, 18 1/31/211 188 51 27.13 PRICE LOW >>>>>>>>>> >>>>>>>>> 3 $ 21,6 $ 6 $ 167,7 15 1/31/212 143 51 35.66 NEUTRAL 327 $ 219,8 $ 72 $ 175, 26 1/31/213 123 67 54.47 SELLLER'S 329 $ 239,8 $ 79 $ 22, 27 1/31/214 14 49 35. NEUTRAL 367 $ 277, $ 12 $ 245, 24 1/31/215 169 46 27.22 BUYER'S 354 $ 273,3 $ 97 $ 249, 24 14' vs 15' 21% -6% -22% -4% -2% -5% 2% % TABLE 6 - The North Kona Condo data is stable. The data suggest fairly soft conditions in this market. Pending Ratio and Price trend in Chart 7 illustrates the current trends. 7. 6.. 4. 3.$215 $222 Chart 7 - Kona Condo Median Price( thous) & Pending Ratio - Past 2 Years Median Price Condo Pending Ratio $225 $226 $23 $235 $237 $243 $252 $254 $245 $246 $249 $2 $26 $248 $2 $24 $23 $22 2. $21 1. $2. $19 CHART 8 - MEDIAN PRICE IS STILL WELL BELOW THE PREVIOUS BUBBLE PEAK WHICH SUGGESTS THAT AT THIS CURRENT CYCLE PRICE STILL HAS MUCH ROOM TO TRAVEL ON THE UPSIDE. 8 7 6 CHART 8 - NORTH KONA CONDO MEDIAN PRICE vs NUMBER SOLD 4 $193, $173, 3 $1, $126, $135, $17, $115, 2 Number Sold 12 Month Period $415, $265, $369, MEDIAN Price $365, $3, $261,3 $21, $167,7 $175, $4, $4, $3, $3, $245, $249, $22, $2, $2, $1, $1, 1 $,

PAGE 5 NORTH KONA LAND DATA TABLE 7 PENDING PENDING TYPE OF Number Sold Average VOLUME Median # SOLD to $1.5M ACTIVE SALES RATIO MARKET 12 Month Period Price MILLIONS Price Last 3 days 1/31/1997 no data no data no data no data 12 $ 193, $ 23.2 $ 127, 24 1/31/1998 no data no data no data PRICE BOTTOM >>>>>>>>>>>>>>>>>>>>> 136 $ 167,2 $ 22.7 $ 11, 15 1/31/1999 325 67 2.62 BUYER'S 192 $ 134,7 $ 25.9 $ 115, 18 1/31/2 221 6 27.15 BUYER'S 298 $ 2,1 $ 59.6 $ 149,8 27 1/31/21 269 54 2.7 BUYER'S 237 $ 26, $ 48.9 $ 167, 17 1/31/22 no data no data no data no data 248 $ 19,6 $ 47.3 $ 152,8 21 1/31/23 19 12 93.58 SELLER'S 28 $ 253,9 $ 71.1 $ 21, 21 1/31/24 54 54 1. DEMAND PEAK 292 $ 336,2 $ 98.2 $ 295, 1 1/31/25 86 32 37.21 NEUTRAL 183 $ 467,7 $ 85.6 $ 399, 13 1/31/26 26 17 8.25 PRICE PEAK >>>>>>>>>>>>>>>>>>>>> 99 $ 5,4 $ 54.5 $, 6 1/31/27 272 16 5.88 BUYER'S 67 $ 442,7 $ 29.7 $ 42, 5 1/31/28 217 6 2.76 DEMAND LOW 51 $ 439,2 $ 22.4 $ 325, 3 1/31/29 287 13 4.53 BUYER'S 42 $ 315,6 $ 13.3 $ 277, 8 1/31/21 197 1 5.8 BUYER'S 54 $ 265, $ 14.3 $ 212, 2 1/31/211 177 8 4.52 BUYER'S 72 $ 249,4 $ 18. $ 19, 5 1/31/212 177 18 1.17 BUYER'S 71 $ 255,4 $ 18.1 $ 187, 9 1/31/213 155 2 12.9 PRICE BOTTOM >>>>>>>>>>>>>>>>>>>>> 147 $ 229,1 $ 33.68 $ 179, 22 1/31/214 141 22 15.6 BUYER'S 156 $ 43,377 $ 62.93 $ 249, 2 1/31/215 141 19 13.48 BUYER'S 114 $ 425,2 $ 48.5 $ 272, 7 14' vs 15' % -14% -14% -27% 5% -23% 9% -65% CHART 9 Land data in this report show sales numbers continue to trail the previous 12 month count. Median Price appreciation has backed off to a more sustainable 9%. Land trend seems to be following the condo market fairly closely in both Median Price and Pending Ratio. See Chart 9 The dip in Pending Ratio in August could be related to the stock market tumble at that time? Both Condo and Land markets, being heavily investor oriented, do seem to follow shifts in other investment markets. Stocks have recovered nicely. It will be interesting to see if Condo and Land market do the same? Chart 9 - Kona Land Median Price (thous) & Pending Ratio Past 2 Years 3. 25. $225 LAND-Median Price LAND Ratio $24 $251 $253 $262 $275 $3 $279 $277 $279 $273 $2 2. $175 $176 $176 $187 $2 15. $1 1. $1 5. $. CHART 1 - NORTH KONA LAND MEDIAN PRICE vs NUMBER SOLD 3 $6, Median Price Number Sold $, 3 $, $42, 2 $399, $4, $325, 2 $295, $277, $249, $272, $3, 1 $21, $212, $19, $187, $149,8 $167, $179, $152,8 $2, 1 $127, $11, $115, $1, CHART 1 - The number sold has turned lower probably due to the lack of inventory of desirable and affordable lots for the dominant mid-level home buyer.

PAGE 6 SUMMARY TABLE OF PENDING RATIO TRENDS FOR NORTH KONA RESIDENTIAL, CONDO AND LAND, BIG ISLAND RESIDENTIAL AND COLOR GUIDE FOR MARKET TYPE: PEAK SELLERS NEUTRAL BUYERS KONA RES, CONDO, LND & BIG IS PENDING RATIO TRENDS KONA RESIDENTIAL PRICE RANGE PENDING RATIO'S TABLE 8 Average TO $4K $41K-$K $1K-$7K $71K-$9K $91-$1.5M $1.1M-$4.M KONA RES KONA CND KONA LND All Three HI Isle RES 1/31/25 65 64 37 55 1/31/26 17 9 8 11 1/31/27 15 6 6 9 1/31/28 1 5 3 6 9 1 8 3 1/31/29 23 11 5 13 19 66 37 16 7 1 4 1/31/21 35 25 5 22 25 81 33 3 12 8 4 1/31/211 36 27 5 22 27 79 45 14 29 1 3 1/31/212 6 36 1 35 36 161 82 33 25 5 4 1/31/213 61 54 13 43 35 186 163 31 14 22 9 1/31/214 42 35 16 31 3 186 53 29 28 26 19 11/3/214 45 43 15 35 3 173 45 45 27 26 19 12/31/214 45 42 14 34 28 164 1 42 36 13 17 1/31/215 33 4 15 29 28 29 43 32 24 13 14 2/28/215 46 35 11 31 31 222 76 48 42 2 2 3/31/215 55 34 15 35 34 357 92 58 48 16 28 4/3/215 53 35 15 34 36 363 127 55 25 8 29 5/31/215 46 35 18 33 35 16 161 49 27 8 29 6/3/215 43 31 17 3 33 182 12 4 28 6 34 7/31/215 42 3 17 3 33 74 56 38 11 41 8/31/215 4 24 22 29 32 17 88 41 31 16 25 9/3/215 46 25 17 29 33 167 123 46 42 12 25 1/31/215 35 27 13 25 31 238 62 41 24 1 18 14' vs 15' -18% -22% -14% -19% 2% 28% 15% 43% -13% -61% -6% TABLE 8 - PENDING RATIO - Higher Ratio = Stronger Market. The Pending Ratio's price range number clearly illustrate where the strong points are. The New Year should bring stronger Ratio numbers. 6 CHART 6 - Kona Residential and Condo Pending Ratios for the past 12 Months 4 3 2 KONA RES KONA CND KONA LND 1 4 3 Chart 7 - North Kona Residential Pending Ratio by Price Range 12 Month Trend 3 2 2 1 1 TO $4K $41K-$K $1K-$7K $71K-$9K $91-$1.5M $1.1M-$4.M Chart 7 -

PAGE 7 KONA RESIDENTIAL PRICE TREND FROM 22 SUBDIVISIONS DEVELOPED IN THE LATE 196'S TO 2. THESE HOMES WITH SIMILARITIES IN 7 6 North Kona Residential Average Price since 1972 based on Price data from 22 Mid Price Range Subdivisions AVG PRICE 26 PEAK $651,3 214 PRICE $517,1 4 3 1991 PEAK PRICE $257,7 $41,1 211 LOW 2 1 198 PEAK $128, $111,7 1984 LOW $23,4 1997 LOW 1972 1974 1976 1978 198 1982 1984 1986 1988 199 1992 1994 1996 1998 2 22 24 26 28 21 212 214 Comments: The basic pattern of residential real estate cycles in Kona seems to be in the process of repeating again. We are still dealing with the effects of the bubble, but the market seems to be in step with the basic cyclical pattern. I believe the huge bubble and following deluge of distressed properties will extend what might have been a normal 12 year cycle by 2 additional years in this current cycle making it around a 14 year cycle? Any other major economic upsets like mini-recessions or catastrophic events would extend it further. Time will tell. One difference in the current cycle is the sharp price growth soon after market bottom in 211. price growth trend until the last few years before peak. Previous cycles did not exhibit this sharp This trend we see now may be due to the fact unprecedented BUBBLE followed by equally sharp decline, Just as the BUBBLE overshot the top of the normal cyclical trend the following contraction in price overshot the bottom. The Fed stepped in holding interest rates low, offering tax credits and the bargain prices caused a rush of investors and first time home buyers. Prices shot up as the distressed properties sold off the median price rose quickly with the absence of low priced inventory and increasing activity in the higher price levels. Now we seem to be back to a more normal market and cyclical trend. Historical trends suggests that this unique BUBBLE effect may lengthen the time period for this current cycle by a couple of years. It is likely that when the 215 data is added we will see a relatively flat year of price appreciation, under 1%. The sales data for the Chart is from 22 subdivisions with combined total of over 3,9 lots. These homes generally are similar in lot and home size. The price range in 214 was from $292, to $73,. The data totals over 69 new and resales over 43 years. Historical record suggest we have several more years of price appreciation ahead.

PAGE 8 TABLE 1 - KONA & WEST COAST CITIES RESIDENTIAL INVENTORY - OCTOBER 31, 215 NOTE: It has been the goal of this Kona vs. West Coast section of the Griggs Report to find a reliable data presentation that illustrates the time lag between the N. Kona Residential market (by association the Hawaii Island real estate market) and the West Coast. Originally the inventory data was the only data studied. The only notable Realtor.com inventory data that clearly showed the peak inventory dates were well in advance of Kona's. This is shown in Table!, "Peak Inventory Date". Many different chart formats showing inventory trends over time were not effective. A new emphasis being put on Sales Price data which was readily available from Case Shiller Home Price Index and Hawaii Information Service. After years of COUNTY KONA LA VEGAS SAN DIEGO SAN FRAN PORTLAND,O SANTA FE, NM POPULATION 21 33,3 9.819M 1.95M 3.95M 85, 2.26M 144,17 Realtor.com - Market Area KONA LA VEGAS SAN DIEGO SAN FRAN PORTLAND SANTA FE, NM Peak Inventory Date Mar-9 Aug-7 Oct-7 Sep-7 Oct-8 Aug-8 Aug-8 Inventory PEAK 475 6875 16423 432 949 5992 1797 Inventory 2 YEARS ago to date 168 2559 1647 161 429 2485 1222 CURRENT INVENTORY 22 2958 112 1579 8 1887 129 % Change 2 YEARS 2% 16% -5% -2% 18% -24% -16% % CHANGE FROM PEAK TO CURRENT -57% -57% -38% -63% -46% -69% -43% TABLE 1 - The Kona inventory decline began 18 months after San Diego reached it's Peak levels in Sep-7. Currently Kona's inventory decline from Peak lags only slightly behind the main CA metros on a percentage basis. It is exactly the same as San Diego at -6% lower than at peak inventory. Inventory Data is from: Realtor.com / Kona data from: Hawaii information Service CHART 1 - This chart shows the price recorded every quarter. Throughout most of this time Kona Peaks and lows followed San Diego by approximately ONE YEAR. San Diego price data is from Case Shiller Home Price Index. It is the index value that represents monthly price change but is not actual price. Kona prices are from moving 12 moth price data from MLS/HI Information Service. Case Shiller updates some times does not come out for over a month. Therefore Charts 1 and 2 will not change with each report. INDEX 3. CHART 1- Kona vs. San Diego Price Trend Past 15 Years San Diego Price KONA PRICE $7, KONA PRICE Kona Peak 11/26 2. Peak 11/25 Kona Pause after steep increase 1/215 $6, 2. Kona Mid Trough 5/211 Pause after steep increase 8/213 $, $4, 1. Mid Trough 8/21 $3, 1. $2,. $1,. 8/1/ 11/1/ 2/1/1 5/1/1 8/1/1 11/1/1 2/1/2 5/1/2 8/1/2 11/1/2 2/1/3 5/1/3 8/1/3 11/1/3 2/1/4 5/1/4 8/1/4 11/1/4 2/1/5 5/1/5 8/1/5 11/1/5 2/1/6 5/1/6 8/1/6 11/1/6 2/1/7 5/1/7 8/1/7 11/1/7 2/1/8 5/1/8 8/1/8 11/1/8 2/1/9 5/1/9 8/1/9 11/1/9 2/1/1 5/1/1 8/1/1 11/1/1 2/1/11 5/1/11 8/1/11 11/1/11 2/1/12 5/1/12 8/1/12 11/1/12 2/1/13 5/1/13 8/1/13 11/1/13 2/1/14 5/1/14 8/1/14 11/1/14 2/1/15 5/1/15 8/1/15

PAGE 9 CHART 2: THE PURPOSE IS TO ILLUSTRATE THAT SAN DIEGO HOME PRICE PERFORMANCE IS A SOLID LEADING INDICATOR FOR KONA PRICE TREND (and HI Island by association). The data in the Chart is based on the moving year over year price appreciation rate. It clearly shows the changes in price momentum with Kona lagging behind San Diego almost exactly ONE YEAR at major shifts in Price momentum. IT IS IMPORTANT TO REMEMBER THAT JUST BECAUSE THE CHART LINE IS DESENDING PRICES CAN STILL BE APPRECIATING AS LONG AS IT IS ABOVE THE HORIZONTAL % AXIS. Kona's current year over year price change is now down to +13.5 % from highs early in the year 2%+. The San Diego is up around + 5% and just starting to trending higher. We see the San Diego declining trend ended 1/14 and then leveled off. This suggests that the current declining trend in Kona year over year appreciation will level off in coming months. San Diego price data is from Case Shiller Home Price Index. Kona prices are from moving 12 moth price data from MLS/HI Information Service. CHART 2- Kona vs. San Diego YEAR /YEAR Price Appreciation Trend Past 15 Years.% Kona 12MN % San Diego 12MN % 4.% 7/4 8/5 3.% 2.% 1.% 8/3 8/4 5/1 11/13 12/14.% 5/11 1/14-1.% 9/1/1 WTC Attack -2.% -3.% 8/1/ 11/1/ 2/1/1 5/1/1 8/1/1 11/1/1 2/1/2 5/1/2 8/1/2 11/1/2 2/1/3 5/1/3 8/1/3 11/1/3 2/1/4 5/1/4 8/1/4 11/1/4 2/1/5 5/1/5 8/1/5 11/1/5 2/1/6 5/1/6 8/1/6 11/1/6 2/1/7 5/1/7 8/1/7 11/1/7 2/1/8 5/1/8 8/1/8 11/1/8 2/1/9 5/1/9 8/1/9 11/1/9 2/1/1 5/1/1 8/1/1 11/1/1 2/1/11 5/1/11 8/1/11 11/1/11 2/1/12 5/1/12 8/1/12 11/1/12 2/1/13 5/1/13 8/1/13 11/1/13 2/1/14 5/1/14 8/1/14 11/1/14 2/1/15 5/1/15 8/1/15 1/8 11/9 USEFUL WEBSITES: COPY AND PASTE INTO YOUR BROWSER B. www.housingtracker.net - Listing inventory and average list prices for 52 large cities. C. www. nahb.org - National Association of Home Builders. D. www.mba.org/researchandforecasts/forecastsandcommentary - You can sign up for their monthly Economic & Finance forecasts. They are very good. E. www.fhfa.gov - Federal Housing Finance Agency - GOVERNMENT DATA ON HOUSING MARKET F. Google search - "Case-Shiller Home Price Indices" G. www.realtytimes.com - Real Estate Agents perspective of local markets. H. www.realtor.org - NAR - Select "News Media" and look for "Economic Housing Indicators". I. www.hawaii.gov/dbedt - Dept. of Business and Economic Development J. www.federalreserve.gov K. www.eia.doe.gov - Energy Information Agency - Oil and Gas prices and forecasts. DATA TABULATED BY: MICHAEL B. GRIGGS, R, CRA, GRI, Clark Realty Corporation THANK YOU FOR YOUR WORDS OF ENCOURAGEMENT, SUGGESTIONS AND COMMENTS THAT CONTINUE TO IMPROVE THE REPORT- Mike Griggs - mikegriggs@hawaiiantel.net cell ph. 88 936-8134 ALL HAWAII DATA HAS BEEN COLLECTED FROM MLS HAWAII, HAWAII INFORMATION SERVICE, REALTORS.COM AND OTHER SOURCES NAMED IN THE REPORT. NOTES: 1) PAGE 1- TABLE 1 - RESIDENTIAL DATA IS LIMITED TO $4M AND UNDER PRICE RANGE IN ORDER TO SCREEN OUT HIGH END ACTIVITY AT KUKIO AND HUALALAI RESORT AREA'S. SIMILARLY THE CONDO AND LAND DATA HAS AN UPPER LIMIT OF $1.5M. 2) NUMBER SOLD, AVERAGE PRICE AND MEDIAN PRICE IS DATA IS FROM A MOVING 12 MONTH PERIOD. UPDATED EVERY TWO WEEKS THIS IS A VERY ACCURATE METHOD OF TRACKING THE SALES PRICE TRENDS. 3) THE PENDING RATIO MAYBE A GOOD LEADING INDICATOR OF MARKET STRENGTH AND PRICE DIRECTION. THE MARKET TYPE DESIGNATION, EG. SELLER, BUYER MARKET, NEUTRAL AND PEAK IS BASED ON CALIBRATION IS USING PENDING RATIO DATA IN THE PAST MARKET CYCLE. 3) DATA REPRESENTS THE ENTIRE NORTH KONA MARKET. IT SHOULD NOT BE CONSTRUED TO BE AN INDICATOR OF THE MARKET CONDITION IN ALL SUBMARKETS WITHIN THE MARKET AREA. EXAMPLE: MARKET CONDITIONS IN SUPPLY AND DEMAND MIGHT BE VERY TIGHT IN LOWER PRICE RANGES WHILE UPPER PRICE RANGE ARE STILL RELATIVELY SOFT MARKETS.