Atlanta Real Estate Market Trends For August 2013

Greater

Metro Atlanta

Market

125,000 Homes Sold In 2006. 60,000 Homes Sold in 2010. 2013 Closings Down Due To Low Inventory And Higher Fallout Rates.

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60000

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2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013

Metro Atlanta Homes Sold

-17.1%

2.2% 1.4%3.0%

8.1%

28.6%

-20%

-10%

0%

10%

20%

30%

40%

< $100K $100K-

$200K

$200K-

$500K

$500K-$1

mil

$1 mil - $2

Mil

$2 Mil +

Metro Atlanta Closings – July 2013 (Compared To Last Month)

Under $100k Slowing Due To Fewer Investors

-53.8%

12.6%

45.8%

60.3%

45.7%

125.0%

-80%

-60%

-40%

-20%

0%

20%

40%

60%

80%

100%

120%

140%

< $100K $100K-

$200K

$200K-

$500K

$500K-$1

mil

$1 mil - $2

Mil

$2 Mil +

Metro Atlanta Closings – July 2013 (Compared To Same Month Last Year)

Under $100k Slowing Due To Fewer Investors

883

1614

2050

412

719

90

500

1000

1500

2000

2500

< $100K $100K-

$200K

$200K-

$500K

$500K-$1

mil

$1 mil - $2

Mil

$2 Mil +

Metro Atlanta Closings – July 2013 (Number Of Transactions)

Under $100k Was Over 50% Of Transactions In 2010. Now Back to 15.5% - Reflecting Normal Distribution.

Listed Inventory July 2011 – July 2013

Residential Detached - Metro Atlanta

• Inventory Levels Down 13.1% from July 2012, 45.1% from July 2011

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Inventory Up

21.8% From

February 2013

6.2

4.9 5.0

4.34.0 4.1

3.8

4.4

3.9 4.0 3.9

4.64.2

3.5 3.43.0

3.4 3.5

7.4

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5

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Jan

FebM

arA

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ayJu

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ugSep

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ovD

ecJa

nFeb

Mar

Apr

May

Jun

Jul

Metro Atlanta – Months Of Supply

(Based Upon Closed Sales)

6 Months Is Considered A Normal Market

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5

10

15

20

25

30

35

< $100K $100K-

$200K

$200K-

$500K

$500K-

$750K

$750K-$1

Mil

$1 mil - $2

Mil

$2 Mil +

Metro Atlanta Months of Inventory (Based On Closed Sales)

It Is A Sellers Market Below $500K In Most Areas.

6 Months Supply Is Considered A Normal Market

Investors See The Opportunity To Buy Low, Lease & Sell High For Single Family Properties!

This Is Causing A Shortage Of Inventory Under $200,000.

Average Sales Price Up 41% In 2013

$184$201

$217$233 $240

$249$260

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300

Jan Feb Mar Apr May Jun Jul

Metro Atlanta 2013 Average Sale Prices

Average Sales Price Increasing From Bottom Of 2011

$241$253

$261$268

$209

$189 $190$176 $183

$226

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2004 2005 2006 2007 2008 2009 2010 2011 2012 2013

Metro Atlanta Average Annual Sale Price Trend

Chart Shows Index Results January 2010 Through May 2013 (As Reported July 2013)

80

85

90

95

100

105

110

Jan

Apr

Jul

Oct

Jan

Apr

July

Oct

Jan

Apr

July

Oct

oJa

nA

pr

Case-Shiller Index For Metro Atlanta

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40

60

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120

1401995

1996

1997

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2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

2012

2013

Case-Shiller Home Values For Metro Atlanta

• Peak was July 2007. Current Home Values Remain Below The

Normal Trend Line. But Prices Are Slowly Correcting!

-0.3 -0.3

2.41.8

2.11.8

-1.0

-6.2

2.6

1.72.0 2.1

-7

-6

-5

-4

-3

-2

-1

0

1

2

3

4

2008 2009 2010 2011 2012 2013

U.S. GDP

Georgia GSP

Georgia Economy Outperforming

The National Economy In 2013 (Terry College of Business – University of Georgia)

• Georgia Lost 325,000 Jobs In The Great Recession.

• 2012 Restarted Positive Job Growth Trend!

-250,000

-50,000-25,000

68,400 63,30076,500

94,400

-300000

-250000

-200000

-150000

-100000

-50000

0

50000

100000

150000

2009 2010 2011 2012 2013 2014 2015

More Jobs In Georgia! (Data From Terry College of Business/ UGA& Georgia State Economic Forecasting Center)

Major Group Moves

And More Coming …

Rustbelt To Sunbelt

4,944,939

7,377,951

8,256,323

-

1,000,000

2,000,000

3,000,000

4,000,000

5,000,000

6,000,000

7,000,000

8,000,000

9,000,000

1990 1995 2000 2005 2010 2015 2020 2025 2030 2035 2040

ARC 20-Cty Population

Forecast Population Growth 20-County Forecast Area

Baby Boomers Are Coming To Be Close

To Their Children & Grandchildren.

Source :Census Bureau

Total Population

Rank of Share

Under 20 20-64 65+ 25-39 45-59

Dallas 6,144,489 3 9 25 1 24

Atlanta 5,271,550 5 6 27 2 19

Phoenix 4,179,427 4 24 15 3 26

Denver 2,466,591 11 5 24 4 12

Riverside 4,081,371 1 27 22 5 27

Houston 5,629,127 2 10 26 6 21

Portland 2,174,631 19 4 19 7 7

Seattle 3,309,347 22 1 20 8 3

Sacramento 2,091,120 12 13 14 9 20

Washington 5,306,125 14 3 23 10 11

Los Angeles 12,875,587 6 17 18 11 23

San Diego 2,974,859 8 14 16 12 25

San Francisco 4,203,898 26 2 10 13 4

Orlando 2,032,496 18 15 8 14 22

Minneapolis 3,208,212 10 7 21 15 6

Chicago 9,522,879 7 16 17 16 18

New York 18,815,988 21 12 6 17 15

Boston 4,482,857 23 8 9 18 10

Cincinnati 2,134,864 9 19 13 19 14

Baltimore 2,668,056 17 11 11 20 9

Detroit 4,467,592 13 18 12 21 5

Philadelphia 5,827,962 16 21 5 22 13

St. Louis 2,802,282 15 20 7 23 8

Miami 5,413,212 24 26 3 24 17

Tampa 2,723,949 25 25 1 25 16

Cleveland 2,096,471 20 23 4 26 2

Pittsburgh 2,355,712 27 22 2 27 1

Metro Atlanta Has The:

•#2 Population Age 25-39

•#5 Population Under 20

Atlanta is 56% Cheaper To Buy!

Metro Atlanta Is 56% Better To Buy Than Rent

• New Household Formation Dropped From 1.2 Mil (2006) To 400,000 (2008)

• Growing To 1.2 Million In 2013. Lots Of Pent-Up Demand.

• 4 Million Students Per Year Graduate From College For Next 10 Years!

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600000

800000

1000000

1200000

1400000

1995-

2005

2006 2007 2008 2009 2010 2011 2012 2013 2015

U. S. Household Formation Trends Demand For 1st Time Buyers Will Be Strong!

Source: U.S. Census, JCHS Household Growth Projections, Goldman Sachs

Prices Improving and Mortgage Rates Rising. But Home Affordability Remains Historically Favorable.

207

187 187197 194

160 154146 141

116

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National Housing Affordability Index (Combination of home prices and mortgage rates)

Average Rates Around 8%

4.9 4.9

3.9

4.9

4.4

3.8

4.7

5.0

4.4

4.8

3.5

4.6

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4.5

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5.5

Freddie Mac & Mortgage Bankers Association

30-Year Fixed Rate Forecast (June 2013)

2010 – 2014 Quarterly Averages

2010 2011 2012 2013 2014

Freddie Mac

MBA

Amount Of

Mortgage

3.5%

Mortgage

30-Year

Cost

5%

Mortgage

30-Year

Cost

8%

Mortgage

30-Year

Cost

$200,000 $898 $323,280 $1,073 $386,280 $1,467 $528,120

$300,000 $1,347 $484,920 $1,610 $579,600 $2,201 $792,360

$400,000 $1,796 $646,560 $2,147 $772,920 $2,935 $1,056,600

$500,000 $2,245 $808,200 $2,684 $966,240 $3,668 $1,320,480

$1 million $4,490 $1,616,400 $5,368 $1,932,480 $7,337 $2,641,320

Increasing Mortgage Rates Make A

Significant Difference In Home Affordability

Metro Atlanta

New Homes

Charts Provided By SmartNumbers and ViaSearch

Metro Atlanta Closings

Blue – Resale Red – New Homes

New Homes Closings Up 55% From Last Year. Resale Units In 2012 At Levels Not

Seen Since 2006. But Almost 50% Of Resale Units From Investors Under $200k.

Buyer Types For New Homes

First Time Buyers And Baby Boomers Remain Most Active Segments.

We Are Looking To See The 1st & 2nd Move-Up Buyers Return.

New Home Permits

New Home Starts Growing Steadily!

Metro Atlanta Inventory (Black Arrow Is Population Trend)

Population Trends Growing Faster Than Inventory

Prudential

Georgia

Realty

Ranked #1 In Homes Sold – 2009, 2010, 2011, 2012 and YTD 2013

1006

5035

817

5057

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PGR Market

July 2013 Closings Vs. July 2012 Closings

• PGR Closings Were Up 23% Compared To July 2012.

• The Market Was Down 1% Compared To July 2012.

PGR

Outperforms

The Market

By 24%!

5167

31296

4587

31775

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PGR Market

YTD 2013 Closings Vs. YTD 2012 Closings

(Data As of July 2013)

PGR

Outperforms

The Market

By 15.1%!

• PGR Closings Were Up 12.6% Compared To YTD 2012.

• The Market Was Down 2.5% Compared To YTD 2012.

Information Provided By Trendgraphix.

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PGR HNR KW-AP CB MB SS AFH

YTD Transactions – July 2013

FMLS Counties + Southern Crescent

Information Provided By Trendgraphix.

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PGR KW-AP HNR CB MB SS AFH

YTD Listing Sales – July 2013

FMLS Counties + Southern Crescent

Information Provided By Trendgraphix.

Buyer Sales Units – July 2013

FMLS Counties + Southern Crescent

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PGR HNR KW-AP MB CB SS AFH

Information Provided By Trendgraphix. PGR Numbers Internal.

Current Listing Inventory – July 2013

FMLS Counties + Southern Crescent

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PGR HNR KW-AP MB CB AFH SS