CS Realtor Survey January 2015

8/9/2019 CS Realtor Survey January 2015

1/55

CREDIT SUISSE SECURITIES (USA) LLC

January 5, 2015

Michael DahlHomebuilding & Building Products

212-325-5882

[email protected]

Patrick Murray, CFA

212-325-5292

[email protected]

Anthony Trainor

212-325-5323

[email protected]

Monthly Survey of Real Estate Agents December 2014

0102030405060708090

100

Dec-12

Jan-13

Feb-13

Mar-13

Apr-13

May-13

Jun-13

Jul-13

Aug-13

Sep-13

Oct-13

Nov-13

Dec-13

Jan-14

Feb-14

Mar-14

Apr-14

May-14

Jun-14

Jul-14

Aug-14

Sep-14

Oct-14

Nov-14

Dec-14

BuyerTrafficIndex

50 - Exceeds Expectations

Our Buyer Traffic Index ticked up to 37 in December, still indicating soft traffic levels relative to

expectations. Rates helped on the margin but diminished affordability remains a headwind.

0102030405060708090

100

Dec-12

Jan-13

Feb-13

Mar-13

Apr-13

May-13

Jun-13

Jul-13

Aug-13

Sep-13

Oct-13

Nov-13

Dec-13

Jan-14

Feb-14

Mar-14

Apr-14

May-14

Jun-14

Jul-14

Aug-14

Sep-14

Oct-14

Nov-14

Dec-14

HomePriceIndex

50 - Higher than Prior Month

Home prices were seen flat m/m in December as buyer resistance to price appreciation continuesto build, even with the partial benefit from more favorable mortgage rate environment.

Source: Credit Suisse

DISCLOSURE APPENDIX AT THE BACK OF THIS REPORT CONTAINS IMPORTANT DISCLOSURES, ANALYST CERTIFICATIONS, AND THE STATUS OF NON-USANALYSTS. US Disclosure: Credit Suisse does and seeks to do business with companies covered in its research reports. As a result, investors should be aware that theFirm 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 investmentdecision.


2/55

December 14Slide 2

MonthBuyer Traffic

IndexHome Price

Index Incentive Index Home Listings

IndexTime to Sell

Index

Jul-14 34.2 64.4 44.3 44.4 44.2

Aug-14 34.8 59.0 40.3 40.8 39.6

Sep-14 29.6 52.7 40.7 41.7 31.3

Oct-14 29.3 51.5 37.3 42.8 33.8

Nov-14 35.2 51.6 38.8 53.1 37.0

Dec-14 36.7 52.3 38.7 60.3 38.0

Point Change 1.5 0.7 (0.1) 7.2 1.0

25%29%

40%

55%64%

44%

20%

7%16%

0%10%20%30%40%50%60%70%

Hom e Pr ices Incen ti ves Time to Se ll

How Do the Recent 30 Days Compare tothe Prior 30 Days...

Increased Remained the same Decreased

December Survey of Real Estate Agents:

2014 Ends on a Steady Note for Both Traffic and Home Prices

Traffic levels continue at modest levels through year-end: Our Buyer Traffic Index increased 2 points in December to 37from 35 in November, though wedview this as typical seasonality combined with the 6 point increase seen in November (ourindex has increased by 2 points on average in November and 5 points in December in its 10-year history). Agents largely blamedprice sensitivity for the soft traffic trends, with more comments of buyer pushback on prices and debt to income limits restrictingdeals. Commentary did suggest the favorable mortgage rate environment was supportive for demand, but failed to drive the level

of excitement seen during past instances of low rates. Relative to prior months, we saw more discussion of a lack of inventorylimiting transactions, though this is also typical seasonally. Comments surrounding soft local economic conditions were lesspronounced than previous months, a positive. Some agents felt lower energy costs helped to lift consumer confidence; however,some from regions with direct employment exposure to oil noted headlines beginning to weigh on clientsminds (though still earlyto gauge the full impact). Regionally, the Pacific Northwest was the only notable outperformer, as Texas and Florida worsenedsequentially. California improved but remained below average along with the Northeast.

Over 75 of mark ets see traffic below expectati on: In December, 31 of the 40 markets we surveyed saw lower thanexpected traffic (28 in November), 6 markets saw traffic in-line with expectations (8 in November), and 3 markets saw better thanexpected traffic (4 in November). Traffic exceeded expectations in Seattle (index +5 points to 63), San Antonio (+8 points to 58)and Denver (+12 points to 60). Outside of San Antonio, Texas was less impressive, with Austin (down 21 pts sequentially),Dallas (down 11) and Houston (down 5) now sitting at or below the national average. Some of the largest index declines wereseen in Florida, with Orlando, Tampa, Sarasota and Fort Myers all seeing double-digit drops. Notable weakness was also seen inthe Inland Empire (lowest reading), San Diego, Phoenix, New York and Chicago.

Flat price trends continue through December: Home prices were flat sequentially again in December (4th consecutivemonths), as our Price Index came in unchanged at 52. Of the 40 markets we survey, 17 saw higher prices in December (14 inNovember), 11 saw flat prices (13 in November) and 12 saw lower prices (13 in November). Weakest price trends were seen inPhoenix, Washington DC and San Diego, while the strongest price readings were seen in Ft Myers, San Antonio and Houston.

17%

40%

43%

Traffic Levels Versus Expectations

More than expected Meets expectations Less than expectedSource: Credit Suisse


3/55

December 14Slide 3

Table o f Contents

Key Housing Markets:

Key Housing Markets Continued:

4

Atlanta, Georgia 26

Orlando, Florida

5 Austin, Texas 27 Philadelphia-Southern New Jersey

6

Baltimore, Maryland 28

Phoenix, Arizona

7

Boston, Massachusetts

29

Portland, Oregon

8

Charleston, South Carolina 30

Raleigh, North Carolina

9

Charlotte, North Carolina 31

Richmond, Virginia

10 Chicago, Illinois 32 Sacramento, California

11

Cincinnati, Ohio 33

San Antonio, Texas

12 Columbus, Ohio 34 San Diego, California

13

Dallas, Texas 35

San Francisco, California

14

Denver, Colorado

36

Sarasota, Florida

15 Detroit, Michigan 37 Seattle, Washington

16

Fort Myers, Florida 38

St. Louis, Missouri

17 Houston, Texas 39 Tampa, Florida

18

Inland Empire (Riverside-San Bernardino), California 40

Tucson, Arizona

19

Jacksonville, Florida 41

Virginia Beach, Virginia

20 Las Vegas, Nevada 42 Washington, D.C.

21

Los Angeles, California

43

Wilmington, North Carolina

22 Miami, Florida Appendix:

23

Minneapolis, Minnesota 45

Historical Trends by Market

24

Nashville, Tennessee 50

Agent Recommendations

25 New York-Northern New Jersey 52 Survey Methodology


4/55

December 14Slide 4

Atlanta, GA Low Inventory and Rates Helping to Buoy Prices as Traffic Remains Soft

Source: Credit Suisse; Census Bureau

(14,803 single-family building permits in 2013, 3rd largest market in the country)

Comments from Real Estate Agents:

Lower inventory.

Not as much traffic as last year. Buyers may still be sittingon sidelines waiting for better inventory to hit the market.

Rates are so low buyers should be jumping at homes but

they are not. Interest rates dropped again and some buyers are rushing

to take advantage of the lower rates.

Many homeowners are listing property again and aregetting quick offers when reasonably priced.

Our Take:

Buyer traffic continued to improve in December, with ourTraffic Index rising to 40 from 33 in November; however, thesub-50 level still indicates slower than expected levels. Multiple

agents noted that lower interest rates have been helping tobring buyers out, but some would have expected a biggersurge as rates have drifted lower.

Agents saw home prices marginally higher as our Price Indexcame in at 55 for December from 57 in November.

Inventories expanded in December, but agents generally stillsee them as too low, which should help support prices.

0102030405060708090

100

Dec-12

Jan-13

Feb-13

Mar-13

Apr-13

May-13

Jun-13

Jul-13

Aug-13

Sep-13

Oct-13

Nov-13

Dec-13

Jan-14

Feb-14

Mar-14

Apr-14

May-14

Jun-14

Jul-14

Aug-14

Sep-14

Oct-14

Nov-14

Dec-14

BuyerTrafficIndex


0102030405060708090

100

Dec

-12

Jan

-13

Feb

-13

Mar

-13

Apr

-13

May

-13

Jun

-13

Jul-13

Aug

-13

Sep

-13

Oct-13

Nov

-13

Dec

-13

Jan

-14

Feb

-14

Mar

-14

Apr

-14

May

-14

Jun

-14

Jul-14

Aug

-14

Sep

-14

Oct-14

Nov

-14

Dec

-14

HomePriceIndex


Month

Buyer Traffic

Index

Home Price

Index Incentive Index

Home Listings

Index

Time to Sell

IndexJul-14 20.6 64.7 38.2 47.1 35.3

Aug-14 40.0 73.3 35.7 33.3 46.7

Sep-14 14.3 47.6 38.1 40.5 23.8

Oct-14 23.3 43.3 21.4 33.3 36.7

Nov-14 33.3 57.1 35.0 65.0 47.6

Dec-14 40.0 55.0 25.0 40.0 35.0

Point Change 6.7 (2.1) (10.0) (25.0) (12.6)

20%

40%

40%


More than expected Meets expectations Less than expected

20%

60%

40%

70%

30%

50%

10% 10% 10%

0%

20%

40%

60%

80%

Home Prices Incentives Time to Sell




5/55

December 14Slide 5

Austin, TX Traffic Slips in December, but Low Inventories Continue to Support Prices


(9,240 single-family building permits in 2013, 8th largest market in the country)


Prices have risen too fast. Even many sellers think homesare overpriced.

Strong resistance to rising prices.

Inventory shortage.

We saw a drop in actual transactions, but did get buyerinterest not only generally, but also for listings.

Strong job market.

Buyers seem to be motivated even though it's not typicallythe best season for lots of home choices.

Our Take:

Buyer traffic slipped back below a neutral 50 in December,with our Traffic Index landing at 38 from 58 in November.Agent comments in December were focused on continued

inventory shortages (despite growing levels) and priceresistance by buyers. We did see some increased commentaryabout sellers willingness to reduce prices to get a deal done.

Home prices were seen modestly higher in December with ourPrice Index improving to 58 from 50 in November.

We expect price gains to remain at modest levels, with thechoppiness to demand offset by still low inventory levels.

0102030405060708090

100

Dec-12

Jan-13

Feb-13

Mar-13

Apr-13

May-13

Jun-13

Jul-13

Aug-13

Sep-13

Oct-13

Nov-13

Dec-13

Jan-14

Feb-14

Mar-14

Apr-14

May-14

Jun-14

Jul-14

Aug-14

Sep-14

Oct-14

Nov-14

Dec-14

BuyerTrafficIndex


0102030405060708090

100

Dec

-12

Jan

-13

Feb

-13

Mar-13

Apr-13

May

-13

Jun

-13

Jul-13

Aug

-13

Sep

-13

Oct-13

Nov

-13

Dec

-13

Jan

-14

Feb

-14

Mar-14

Apr-14

May

-14

Jun

-14

Jul-14

Aug

-14

Sep

-14

Oct-14

Nov

-14

Dec

-14

HomePriceIndex


Month

Buyer Traffic

Index

Home Price


Home Listings

Index

Time to Sell

IndexJul-14 45.0 80.0 55.0 27.8 60.0

Aug-14 46.9 60.0 40.6 31.3 31.3

Sep-14 20.0 60.7 32.1 35.7 32.1

Oct-14 19.2 57.7 23.1 50.0 20.8

Nov-14 58.3 50.0 25.0 34.6 15.4

Dec-14 37.5 58.3 37.5 45.8 20.8

Point Change (20.8) 8.3 12.5 11.2 5.4

25%

25%

50%



42% 42%

67%

33%42%

25%25%17%

8%

0%

10%

20%

30%

40%

50%60%

70%





6/55

December 14Slide 6

Baltimore, MD Traffic Levels Better, but Still Weak; Home Prices Continue to Hold Up




No reason for anyone to get off the fence.

Expectations for another government shutdown.

Maybe a little bounce from lower gas prices.

Level of interest rates and consumer confidence continue tobe the motivator and the ever decreasing unemployment rateand strong stock market are signs that the economy willcontinue to grow.

Our Take:

Buyer traffic moved up from the basement with our TrafficIndex registering a 33 reading in December from 5 inNovember. While the majority of commentary remains dour

with little expectation of a near-term pick-up, some agents haveseen some incremental activity driven by low interest rates.

Despite the consistently soft traffic trends over the past year,home prices continue to hold up with agents seeing onlymodestly lower prices in December (Price Index level of 44).

After four consecutive months of inventory growth, supplycontracted in December, but the time to sell increased again.

0102030405060708090

100

Dec-12

Jan-13

Feb-13

Mar-13

Apr-13

May-13

Jun-13

Jul-13

Aug-13

Sep-13

Oct-13

Nov-13

Dec-13

Jan-14

Feb-14

Mar-14

Apr-14

May-14

Jun-14

Jul-14

Aug-14

Sep-14

Oct-14

Nov-14

Dec-14

BuyerTrafficIndex


Month

Buyer Traffic

Index

Home Price


Home Listings

Index

Time to Sell

IndexJul-14 40.0 70.0 50.0 50.0 40.0

Aug-14 38.9 44.4 50.0 31.3 31.3

Sep-14 14.3 50.0 35.7 42.9 21.4

Oct-14 20.0 50.0 30.0 20.0 15.0

Nov-14 5.0 44.4 45.0 20.0 15.0

Dec-14 33.3 44.4 44.4 72.2 27.8

Point Change 28.3 0.0 (0.6) 52.2 12.8

11%

45%

44%



0%11%

67%

89% 89%

11%11%0%

22%

0%

20%

40%

60%

80%

100%




0102030405060708090

100

Dec

-12

Jan

-13

Feb

-13

Mar-13

Apr-13

May

-13

Jun

-13

Jul-13

Aug

-13

Sep

-13

Oct-13

Nov

-13

Dec

-13

Jan

-14

Feb

-14

Mar-14

Apr-14

May

-14

Jun

-14

Jul-14

Aug

-14

Sep

-14

Oct-14

Nov

-14

Dec

-14

HomePriceIndex



7/55

December 14Slide 7

Boston, MA Inventory Levels Seen Too Low by Nearly All Agents, Serving to Slow Buyers




Buyers are hoping for better quality of inventory.

Lack of inventory.

Not enough inventory.

The lack of inventory has made home buyers continue to

look throughout the holiday season.

Low inventory and low interest rates driving buyers.

Reduced inventory.

Our Take:

Buyer traffic softened in December with our Traffic Indexsliding to 30 from 44 in November. Nearly every comment fromagents this month was centered on low inventory levels, and

while most saw low inventory as a limiting factor, othersactually saw some buyer urgency driven by the lack of supply(also helped by low interest rates).

Home prices were flat sequentially as our Price Index came inat 50 for December form 48 in November.

Inventories continued to shrink in December from already lowlevels, which should continue to support prices.

0102030405060708090

100

Dec-12

Jan-13

Feb-13

Mar-13

Apr-13

May-13

Jun-13

Jul-13

Aug-13

Sep-13

Oct-13

Nov-13

Dec-13

Jan-14

Feb-14

Mar-14

Apr-14

May-14

Jun-14

Jul-14

Aug-14

Sep-14

Oct-14

Nov-14

Dec-14

BuyerTrafficIndex


0102030405060708090

100

Dec

-12

Jan

-13

Feb

-13

Mar-13

Apr-13

May

-13

Jun

-13

Jul-13

Aug

-13

Sep

-13

Oct-13

Nov

-13

Dec

-13

Jan

-14

Feb

-14

Mar-14

Apr-14

May

-14

Jun

-14

Jul-14

Aug

-14

Sep

-14

Oct-14

Nov

-14

Dec

-14

HomePriceIndex


Month

Buyer Traffic

Index

Home Price


Home Listings

Index

Time to Sell

IndexJul-14 36.8 68.4 55.6 55.3 42.1

Aug-14 22.2 64.7 50.0 63.9 36.1

Sep-14 35.0 67.5 50.0 39.5 25.0

Oct-14 37.0 52.2 59.5 47.8 41.3

Nov-14 43.8 47.8 54.3 77.1 35.4

Dec-14 30.0 50.0 55.9 77.5 42.5

Point Change (13.8) 2.2 1.5 0.4 7.1

15%

30%55%



10%0%

40%

80%

88%

35%

10% 12%25%

0%

20%

40%

60%

80%

100%





8/55

December 14Slide 8

Charleston, SC Shrinking Inventories and Modest Traffic Levels Balance to Keep Prices About Flat




Investors are buying properties to upgrade and resell.

Have seen more empty-nesters and retirees headingsouth.

More people coming to buy second homes.

Our Take:

Buyer traffic was better in December, but still shy ofexpectations with our Traffic Index hitting 43 vs. 39 inNovember. Agents continue to see second home buyers and

retirees/empty-nesters from northern states head south,helping to drive buyer traffic. We also saw commentarysuggesting that flipping activity has picked up in the area.

Home prices increased slightly in December with our PriceIndex hitting 56, unchanged from November.

Inventory levels continued to fall in December, and with the stillsoft traffic levels, balanced out for a flat time to sell.

0102030405060708090

100

Dec-

12

Jan-

13

Feb-

13

Mar-

13

Apr-

13

May-

13

Jun-

13

Jul-

13

Aug-

13

Sep-

13

Oct-

13

Nov-

13

Dec-

13

Jan-

14

Feb-

14

Mar-

14

Apr-

14

May-

14

Jun-

14

Jul-

14

Aug-

14

Sep-

14

Oct-

14

Nov-

14

Dec-

14

BuyerTrafficIndex


0102030405060708090

100

Dec

-12

Jan

-13

Feb

-13

Mar-13

Apr-13

May

-13

Jun

-13

Ju

l-13

Aug

-13

Sep

-13

Oct-13

Nov

-13

Dec

-13

Jan

-14

Feb

-14

Mar-14

Apr-14

May

-14

Jun

-14

Ju

l-14

Aug

-14

Sep

-14

Oct-14

Nov

-14

Dec

-14

HomePriceIndex


Month

Buyer Traffic

Index

Home Price


Home Listings

Index

Time to Sell

IndexJul-14 30.0 80.0 75.0 70.0 70.0

Aug-14 50.0 64.3 40.0 50.0 50.0

Sep-14 33.3 83.3 40.0 41.7 41.7

Oct-14 30.0 75.0 25.0 37.5 50.0

Nov-14 38.9 55.6 33.3 81.3 56.3

Dec-14 42.9 56.3 31.3 62.5 50.0

Point Change 4.0 0.7 (2.1) (18.8) (6.3)

28%

29%

43%



25%

38%

13%

63% 63%

75%

13%

0%

13%

0%

20%

40%

60%

80%

Home Pr ices Incent ives Time to Sel l




9/55

December 14Slide 9

Charlotte, NC Home Prices Pushed Higher by Low Inventories, but Buyers Wait for Options




Low inventory levels have slowed traffic.

With prices rebounding, seems as if buyers are holdingback to see what happens after the first of the year.

Lack of good inventory.

Interest rates and a pent up desire for home ownership.

An influx of qualified buyers not wanting to wait until spring.They still feel there are good deals out there. Cashbuyers/investors on the rise.

Low interest rates and the fear of a rise in rates.

Our Take:

Our Buyer Traffic Index slipped to 39 in December from aneutral 50 in November. Agents continue to see buyersstymied by low inventory levels with many seemingly holding

out for more/better options in the spring, although some arestill motivated to buy rather than wait. Others have beenspurred by low interest rates and a fear that they may rise.

Home prices began to rise again in December as indicated byour Price Index increasing to 67 from 50 in November.

Prices may be supported in coming months despite the softertraffic as listings and the time to sell both fell in November.

0102030405060708090

100

Dec-

12

Jan-

13

Feb-

13

Mar-

13

Apr-

13

May-

13

Jun-

13

Jul-

13

Aug-

13

Sep-

13

Oct-

13

Nov-

13

Dec-

13

Jan-

14

Feb-

14

Mar-

14

Apr-

14

May-

14

Jun-

14

Jul-

14

Aug-

14

Sep-

14

Oct-

14

Nov-

14

Dec-

14

BuyerTrafficIndex


0102030405060708090

100

Dec

-12

Jan

-13

Feb

-13

Mar-13

Apr-13

May

-13

Jun

-13

Ju

l-13

Aug

-13

Sep

-13

Oct-13

Nov

-13

Dec

-13

Jan

-14

Feb

-14

Mar-14

Apr-14

May

-14

Jun

-14

Ju

l-14

Aug

-14

Sep

-14

Oct-14

Nov

-14

Dec

-14

HomePriceIndex


Month

Buyer Traffic

Index

Home Price


Home Listings

Index

Time to Sell

IndexJul-14 30.0 70.0 40.0 60.0 50.0

Aug-14 42.3 57.7 50.0 46.2 42.3

Sep-14 28.6 42.9 35.7 64.3 35.7

Oct-14 25.0 57.1 35.7 50.0 28.6

Nov-14 50.0 50.0 18.2 62.5 37.5

Dec-14 38.9 66.7 27.8 68.8 66.7

Point Change (11.1) 16.7 9.6 6.3 29.2

22%

33%

45%



33%

44%

0%

67%

56%

67%

0% 0%

33%

0%

10%

20%

30%

40%

50%60%

70%





10/55

December 14Slide 10

Chicago, IL Home Prices Continue Skid as Buyer Show No Sense of Urgency




Still hard to finance for first-time buyers. Buyers generallyskittish regarding the economy.

There is no urgency. New loan applications are way down.

We had a very active spring but the market, especially over

$1 million, has been almost dead since then. Inventories are low and buyers are not motivated to act.

Buyers are complacent, there is no urgency as the talk ofincreased interest rates has been discussed for a year andthey are still low.

Our Take:

Buyer traffic remains sluggish in Chicago, with our TrafficIndex coming in at 27 for December, up from 20 in November.Multiple agents noted that there is very little buyer urgency due

to both low inventories, and little expectation for higher interestrates in 2015. Some agents have also seen a markedslowdown at high price points which were strong in the spring.

Home prices fell again in December, with our Price Indexlanding at 38 vs. 37 in November.

Declining inventories should help prices, but the weak traffic islikely too much to overcome and prices may remain soft.

0102030405060708090

100

Dec-1

2

Jan-1

3

Feb-1

3

Mar-1

3

Apr-1

3

May-1

3

Jun-1

3

Jul-1

3

Aug-1

3

Sep-1

3

Oct-1

3

Nov-1

3

Dec-1

3

Jan-1

4

Feb-1

4

Mar-1

4

Apr-1

4

May-1

4

Jun-1

4

Jul-1

4

Aug-1

4

Sep-1

4

Oct-1

4

Nov-1

4

Dec-1

4

BuyerTrafficIndex


0102030405060708090

100

Dec

-12

Jan

-13

Feb

-13

Mar-13

Apr-13

May

-13

Jun

-13

Ju

l-13

Aug

-13

Sep

-13

Oc

t-13

Nov

-13

Dec

-13

Jan

-14

Feb

-14

Mar-14

Apr-14

May

-14

Jun

-14

Ju

l-14

Aug

-14

Sep

-14

Oc

t-14

Nov

-14

Dec

-14

HomePriceIndex


Month

Buyer Traffic

Index

Home Price


Home Listings

Index

Time to Sell

Index

Jul-14 27.3 57.5 44.1 35.0 42.5

Aug-14 28.8 48.4 46.8 43.9 25.8

Sep-14 17.1 41.4 45.0 47.1 27.1

Oct-14 9.1 37.9 43.3 46.9 21.2

Nov-14 20.3 36.5 44.1 58.1 20.3

Dec-14 27.4 38.1 46.1 63.4 29.8

Point Change 7.1 1.6 1.9 5.3 9.5

12%

31%57%



10%16%

50%57%

76%

40%33%

8% 10%

0%

20%

40%

60%

80%

100%

Home Pri ces Incent ives Time to Sel l




11/55

December 14Slide 11

Cincinnati, OH Home Prices Slide with Soft Traffic, but May Get Support from Declining Inventories




Typical slowing for the holidays. Fewer than normalinquiries about listing and buying in the new year have usconcerned.

Availability and a need for buyer/seller education pertaining

to current market realities. Buyers are out; but sellers seem to be waiting for the first of

the year.

I think (hope) people are waiting until after the first of theyear to think about real estate.

Our Take:

Our Buyer Traffic Index improved in December, but levels arestill below agents expectations as indicated by the reading of42 vs. 33 in November. Agents continued to see discrepancies

between buyers and sellers on price, and while some sawpockets of buyer activity, more agents were concerned thatinquiry levels were likely pointing to softer months ahead.

Home prices were seen modestly lower sequentially inDecember after coming in flat in October and November.

The drop in inventories over the past two months shouldcontinue to help support prices despite soft traffic levels.

0

10

20

30

40

50

60

70

80

Dec-1

2

Jan-1

3

Feb-1

3

Mar-1

3

Apr-1

3

May-1

3

Jun-1

3

Jul-1

3

Aug-1

3

Sep-1

3

Oct-1

3

Nov-1

3

Dec-1

3

Jan-1

4

Feb-1

4

Mar-1

4

Apr-1

4

May-1

4

Jun-1

4

Jul-1

4

Aug-1

4

Sep-1

4

Oct-1

4

Nov-1

4

Dec-1

4

BuyerTrafficIndex


0

10

20

30

40

50

60

70

80

90

Dec-12

Jan

-13

Feb

-13

Mar-13

Apr-13

May-13

Jun

-13

Ju

l-13

Aug

-13

Sep

-13

Oc

t-13

Nov-13

Dec-13

Jan

-14

Feb

-14

Mar-14

Apr-14

May-14

Jun

-14

Ju

l-14

Aug

-14

Sep

-14

Oc

t-14

Nov-14

Dec-14

HomePriceIndex


Month

Buyer Traffic

Index

Home Price


Home Listings

Index

Time to Sell

Index

Jul-14 28.6 71.4 50.0 50.0 35.7

Aug-14 41.7 70.0 20.0 40.0 40.0

Sep-14 25.0 33.3 33.3 41.7 25.0

Oct-14 33.3 50.0 33.3 33.3 16.7

Nov-14 33.3 50.0 40.0 83.3 33.3

Dec-14 41.7 41.7 33.3 91.7 41.7

Point Change 8.3 (8.3) (6.7) 8.3 8.3

33%

17%

50%



17%

50%

33%

50%

33%

50%

33%

17% 17%

0%

10%

20%

30%

40%

50%

60%





12/55

December 14Slide 12

Columbus, OH Buyer Traffic Better, but Still Soft; Home Prices Resume the Push Higher




A lot more people than before seem to be questioning thevalue of buying real estate. I am now hearing this from morethan just young people. At a time when I thought thatsentiment should have subsided, it appears to be building.

Extremely low inventory. Market slowed a bit but continues to have low inventory and

values balanced this month.

Poor inventory of home choices still remain.

Low interest rates.

Our Take:

Our Buyer Traffic Index continued to move higher in December,with a reading of 39 vs. 19 in November, although both levelsindicate traffic below agents expectations. Agents continue to

see low inventory levels as the primary driver behind slowbuyer activity, although some have seen the benefit of lowerinterest rates pushing more people to look at what is out there.

Home prices improved in December with our Price Indexcoming in at 61 from 50 in November.

Despite sliding inventories, the time to sell continued to fall asweak traffic levels have persisted.

0102030405060708090

100

Dec-1

2

Jan-1

3

Feb-1

3

Mar-1

3

Apr-1

3

May-1

3

Jun-1

3

Jul-1

3

Aug-1

3

Sep-1

3

Oct-1

3

Nov-1

3

Dec-1

3

Jan-1

4

Feb-1

4

Mar-1

4

Apr-1

4

May-1

4

Jun-1

4

Jul-1

4

Aug-1

4

Sep-1

4

Oct-1

4

Nov-1

4

Dec-1

4

BuyerTrafficIndex


0102030405060708090

100

Dec-12

Jan

-13

Feb

-13

Ma

r-13

Apr-13

May-13

Jun

-13

Ju

l-13

Aug

-13

Sep

-13

Oc

t-13

Nov-13

Dec-13

Jan

-14

Feb

-14

Ma

r-14

Apr-14

May-14

Jun

-14

Ju

l-14

Aug

-14

Sep

-14

Oc

t-14

Nov-14

Dec-14

HomePriceIndex


Month

Buyer Traffic

Index

Home Price


Home Listings

Index

Time to Sell

Index

Jul-14 50.0 92.9 42.9 57.1 85.7

Aug-14 37.5 68.8 42.9 43.8 43.8

Sep-14 40.0 70.0 33.3 50.0 55.0

Oct-14 12.5 71.4 21.4 50.0 71.4

Nov-14 18.8 50.0 42.9 75.0 31.3

Dec-14 38.9 61.1 50.0 83.3 44.4

Point Change 20.1 11.1 7.1 8.3 13.2

22%

33%

45%



22%13%

22%

78% 75% 67%

0%13% 11%

0%

20%

40%

60%

80%

100%





13/55

December 14Slide 13

Dallas, TX Home Prices Slip as Buyer Traffic Softens Further Particularly at High End


(20,805 single-family building permits in 2013, 2nd largest market in the country)


Slim inventory and increasing home prices.

Very low inventory.

Have seen many couples/families looking at the new homemarket, and particularly on $300k to $450k range. Same

holds true for older clients that presently have a two-storyand looking for single-story home for health reasons. Ourmarket is slowing above $500k.

Rising rents and corporate relocation continue to drive ourfall traffic.

Our Take:

Buyer traffic softened in December with our Traffic Index hitting22 from 33 in November. Agents continue to see buyers put offby low inventory levels and rising home prices. Some activity

has been seen at middle price points and corporate relocationsare still bringing buyers to the area, but it may be at a slowerpace than what was seen earlier in the year.

Home prices slipped in December with our Price Indexregistering a 44 reading, down from 54 in November.

Declining inventory levels were not enough to offset the slowtraffic levels, as the time to sell continued to edge higher.

0102030405060708090

100

Dec-12

Jan-13

Feb-13

Mar-13

Apr-13

May-13

Jun-13

Jul-13

Aug-13

Sep-13

Oct-13

Nov-13

Dec-13

Jan-14

Feb-14

Mar-14

Apr-14

May-14

Jun-14

Jul-14

Aug-14

Sep-14

Oct-14

Nov-14

Dec-14

BuyerTrafficIndex


0102030405060708090

100

Dec-12

Jan-13

Feb-13

Ma

r-13

Ap

r-13

May-13

Jun-13

Ju

l-13

Aug-13

Sep-13

Oc

t-13

Nov-13

Dec-13

Jan-14

Feb-14

Ma

r-14

Ap

r-14

May-14

Jun-14

Ju

l-14

Aug-14

Sep-14

Oc

t-14

Nov-14

Dec-14

HomePriceIndex


Month

Buyer Traffic

Index

Home Price


Home Listings

Index

Time to Sell

Index

Jul-14 55.6 81.3 61.1 72.2 61.1

Aug-14 41.7 91.7 40.0 33.3 50.0

Sep-14 50.0 54.5 40.9 72.7 27.3

Oct-14 20.0 66.7 37.5 77.8 50.0

Nov-14 33.3 54.2 40.9 68.2 33.3

Dec-14 22.2 44.4 25.0 75.0 44.4

Point Change (11.1) (9.7) (15.9) 6.8 11.1

0%

44%

56%



33%

50%

22%22%

50%

67%

44%

0%

11%

0%

10%

20%

30%

40%

50%60%

70%




D CO H P i R G h R l i d R D i B


14/55

December 14Slide 14

Denver, CO Home Prices Resume Growth as Relocations and Rates Drive Buyers




Low interest rates and fear they may be rising.

Few affordable homes and more buyers than houses.

I'm seeing a lot of relocation buyers and sellers. I think theeconomy is improving slowly so companies are moving key

people again. Low interest rates, easing of credit requirements and more

buyers feeling better about the economy.

Buyers are still out looking but the lack of inventory ismaking it difficult.

More relocating buyers from personal referrals.

Our Take:

Buyer traffic exceeded expectations in Denver for the first timesince April as our Traffic Index hit 60, its highest level sinceJune 2013 (up from 48 in November). Agents saw more buyers

driven by lower rates and corporate relocations, while lowinventory levels are still a headwind.

Home prices were seen higher in December as indicated by a60 reading in our Price Index, up from 52 in November.

Price appreciation should continue in the near-term as solidtraffic levels are met by lower inventories and a flattening out ofthe average time on the market for listings.

0102030405060708090

100

Dec-12

Jan-13

Feb-13

Mar-13

Apr-13

May-13

Jun-13

Jul-13

Aug-13

Sep-13

Oct-13

Nov-13

Dec-13

Jan-14

Feb-14

Mar-14

Apr-14

May-14

Jun-14

Jul-14

Aug-14

Sep-14

Oct-14

Nov-14

Dec-14

BuyerTrafficIndex


0102030405060708090

100

Dec-12

Jan-13

Feb-13

Ma

r-13

Ap

r-13

May-13

Jun-13

Ju

l-13

Aug-13

Sep-13

Oc

t-13

Nov-13

Dec-13

Jan-14

Feb-14

Ma

r-14

Ap

r-14

May-14

Jun-14

Ju

l-14

Aug-14

Sep-14

Oc

t-14

Nov-14

Dec-14

HomePriceIndex


Month

Buyer Traffic

Index

Home Price


Home Listings

Index

Time to Sell

Index

Jul-14 29.2 75.0 40.9 41.7 58.3

Aug-14 41.3 63.0 37.0 31.8 40.5

Sep-14 37.0 50.0 38.6 41.3 32.6

Oct-14 44.2 44.2 36.0 48.0 25.0

Nov-14 48.0 52.1 33.3 75.0 39.6

Dec-14 59.5 59.5 42.1 88.1 52.4

Point Change 11.5 7.4 8.8 13.1 12.8

24%

71%

5%



38%

21% 19%

43%

74%

57%

19%

5%

24%

0%

20%

40%

60%

80%

Home Pr ices Incen ti ves Time to Sel l



D i MI H P i C i Fl D i W k T ffi d Ri i Ti M k


15/55

December 14Slide 15

Detroit, MI Home Prices Come in Flat Despite Weak Traffic and Rising Time on Market




Uncertain economic conditions and lender requirements.

Built up buyer demand met...we are back to more typicalyear end market.

Seasonal slowdown. Still making a few deals.

A few serious buyers with the usual seasonal slow down.

Continuing to get multiple offers in some areas, and thensome areas have no traffic.

Our Take:

Our Buyer Traffic Index moved up to 36 in December from 29in November. While recognized as a seasonally slow period,agents generally saw still-slower than expected trafficconditions due to a challenged local economy. Agents alsomentioned difficult lending requirements and pent-up demandhaving been fully met as being behind some of the slowness.

Home prices were seen flat in December vs. November asindicated by our Price Index coming in at a near-neutral 47.

Price appreciation should be limited in the near-term as trafficlevels remain weak and the time to sell continues to grow.

0102030405060708090

100

Dec-12

Jan-13

Feb-13

Mar-13

Apr-13

May-13

Jun-13

Jul-13

Aug-13

Sep-13

Oct-13

Nov-13

Dec-13

Jan-14

Feb-14

Mar-14

Apr-14

May-14

Jun-14

Jul-14

Aug-14

Sep-14

Oct-14

Nov-14

Dec-14

BuyerTrafficIndex


0102030405060708090

100

Dec-12

Jan-13

Feb-13

Ma

r-13

Ap

r-13

May-13

Jun-13

Ju

l-13

Aug-13

Sep-13

Oc

t-13

Nov-13

Dec-13

Jan-14

Feb-14

Ma

r-14

Ap

r-14

May-14

Jun-14

Ju

l-14

Aug-14

Sep-14

Oc

t-14

Nov-14

Dec-14

HomePriceIndex


Month

Buyer Traffic

Index

Home Price


Home Listings

Index

Time to Sell

Index

Jul-14 25.0 62.5 45.5 37.5 45.8

Aug-14 25.0 60.7 42.3 28.6 32.1

Sep-14 37.5 61.8 46.9 50.0 35.3

Oct-14 19.4 44.4 37.5 47.2 30.6

Nov-14 29.4 41.2 36.7 43.8 31.3

Dec-14 36.1 47.2 53.1 52.8 25.0

Point Change 6.7 6.0 16.5 9.0 (6.3)

11%

50%

39%



17% 13%

50%61%

69%

50%

22% 19%

0%0%

20%

40%

60%

80%





16/55

H t TX L I t i Still H ti b t L Oil P i Al B i i t W i h Mi d


17/55

December 14Slide 17

Houston, TX Low Inventories Still Hurting, but Lower Oil Prices Also Beginning to Weigh on Minds


(34,509 single-family building permits in 2013, largest market in the country)


Falling oil prices beginning to weigh on people's minds in acity dominated by oil.

No inventory.

Price of oil is causing a much slower market that expected.

Low inventory continues to be an issue but with rates stillhelping affordability, buyers continue to look for propertiesas they are brought to market.

While December traffic is normal for December, extremelylow inventory is taking its toll causing buyers to give up.

Our Take:

Our Buyer Traffic Index slid to 32 in December from 37 inNovember, with both levels indicating slower than expectedtraffic. While a few agents did mention lower oil pricesbeginning to shake confidence, it was certainly not universal,with low inventories cited more commonly as the driver behindslower than expected buyer traffic levels.

Home prices continued to rise in December with our PriceIndex landing at 68 from 70 in November.

Continued declines in inventories should help support pricesnear-term despite the recent slowdown in demand.

0102030405060708090

100

Dec-12

Jan-13

Feb-13

Mar-13

Apr-13

May-13

Jun-13

Jul-13

Aug-13

Sep-13

Oct-13

Nov-13

Dec-13

Jan-14

Feb-14

Mar-14

Apr-14

May-14

Jun-14

Jul-14

Aug-14

Sep-14

Oct-14

Nov-14

Dec-14

BuyerTrafficIndex


0102030405060708090

100

Dec-12

Jan-13

Feb-13

Ma

r-13

Ap

r-13

May-13

Jun-13

Ju

l-13

Aug-13

Sep-13

Oc

t-13

Nov-13

Dec-13

Jan-14

Feb-14

Ma

r-14

Ap

r-14

May-14

Jun-14

Ju

l-14

Aug-14

Sep-14

Oc

t-14

Nov-14

Dec-14

HomePriceIndex


Month

Buyer Traffic

Index

Home Price


Home Listings

Index

Time to Sell

Index

Jul-14 22.2 72.2 44.4 40.0 60.0

Aug-14 50.0 82.4 47.1 50.0 73.5

Sep-14 33.3 72.2 38.9 55.6 61.1

Oct-14 57.1 75.0 31.3 50.0 62.5

Nov-14 36.7 70.0 20.0 60.0 46.7

Dec-14 31.8 68.2 22.7 80.0 54.5

Point Change (4.8) (1.8) 2.7 20.0 7.9

9%

46%

45%



45%

55%

18%

45% 45%

55%

9%

0%

27%

0%

10%

20%

30%

40%50%

60%




I l d E i CA H P i U d P T ffi R i W k


18/55

December 14Slide 18

Inland Empire, CA Home Prices Under Pressure as Traffic Remains Weak


(6,359 single-family building permits in 2013, 21st largest market in the country)


Low inventory, overpriced listings.

Lack of jobs. Tighter lending requirements.

Lenders still requiring a myriad of documentation and haveguidelines that are too strict. FHA MI is making payments

too high for first time home buyers. Most condo complexesare not FHA approved.

Lack of inventory.

Normal activity for December.

Our Take:

Our Buyer Traffic Index slipped back to 13 in December from21 in November, with agents continuing to see buyers limitedby lending requirements. While comments about sloweractivity driven by lower loan limits have dissipated, we haveseen more comments from agents about documentation andmortgage insurance keeping buyers from purchasing homes.

Home prices were seen lower in December as our Price Indexfell to 38 from a neutral 54 in November.

We expect prices to remain under pressure given the dearth ofbuyer traffic and expanding supply levels.

0102030405060708090

100

Dec-12

Jan-13

Feb-13

Mar-13

Apr-13

May-13

Jun-13

Jul-13

Aug-13

Sep-13

Oct-13

Nov-13

Dec-13

Jan-14

Feb-14

Mar-14

Apr-14

May-14

Jun-14

Jul-14

Aug-14

Sep-14

Oct-14

Nov-14

Dec-14

BuyerTrafficIndex


0102030405060708090

100

Dec-12

Jan-13

Feb-13

Ma

r-13

Ap

r-13

May-13

Jun-13

Ju

l-13

Aug-13

Sep-13

Oc

t-13

Nov-13

Dec-13

Jan-14

Feb-14

Ma

r-14

Ap

r-14

May-14

Jun-14

Ju

l-14

Aug-14

Sep-14

Oc

t-14

Nov-14

Dec-14

HomePriceIndex


Month

Buyer Traffic

Index

Home Price


Home Listings

Index

Time to Sell

Index

Jul-14 15.0 65.0 30.0 30.0 20.0

Aug-14 13.3 43.8 33.3 9.4 12.5

Sep-14 7.1 57.7 46.4 17.9 17.9

Oct-14 19.2 30.8 25.0 19.2 15.4

Nov-14 20.8 54.2 27.8 45.8 20.8

Dec-14 13.3 37.5 36.7 37.5 14.3

Point Change (7.5) (16.7) 8.9 (8.3) (6.5)

0%

27%

73%



19%27%

71%

38%

73%

29%

44%

0% 0%0%

20%

40%

60%

80%




Jackson ille FL Traffic Meets E pectations Again as Prices Hold


19/55

December 14Slide 19

Jacksonville, FL Traffic Meets Expectations Again as Prices Hold


(6,276 single-family building permits in 2013, 22nd largest market in the country)


Very slow - buyers waiting for price corrections and newinventory.

Low end, middle and high end properties seem to beselling well.

Navy relocations have helped.

Our Take:

Traffic held at levels in-line with agents expectations inDecember, as our Buyer Traffic Index came in at 50,unchanged from November. Agents noted that buyerresistance to price gains over the last year is limiting interest atcurrent levels, with many holding out of list price reductions.

Home prices were flat again in December, with our Price Indexcoming at 50 unchanged from November.

We expect modest price gains to continue, as a shorteraverage time on market and some inventory gains have beenbalanced by average demand from buyers.

0102030405060708090

100

Dec-12

Jan-13

Feb-13

Mar-13

Apr-13

May-13

Jun-13

Jul-13

Aug-13

Sep-13

Oct-13

Nov-13

Dec-13

Jan-14

Feb-14

Mar-14

Apr-14

May-14

Jun-14

Jul-14

Aug-14

Sep-14

Oct-14

Nov-14

Dec-14

BuyerTrafficIndex


0102030405060708090

100

De

c-12

Jan-13

Feb-13

Ma

r-13

Ap

r-13

Ma

y-13

Jun-13

Ju

l-13

Aug-13

Sep-13

Oc

t-13

No

v-13

De

c-13

Jan-14

Feb-14

Ma

r-14

Ap

r-14

Ma

y-14

Jun-14

Ju

l-14

Aug-14

Sep-14

Oc

t-14

No

v-14

De

c-14

HomePriceIndex


Month

Buyer Traffic

Index

Home Price


Home Listings

Index

Time to Sell

Index

Jul-14 35.7 64.3 57.1 50.0 64.3

Aug-14 27.8 72.2 27.8 62.5 61.1

Sep-14 20.0 65.0 35.0 45.0 44.4

Oct-14 33.3 66.7 41.7 50.0 50.0

Nov-14 50.0 50.0 43.8 43.8 50.0

Dec-14 50.0 50.0 30.0 41.7 58.3

Point Change 0.0 0.0 (13.8) (2.1) 8.3

14%

72%

14%



17%

40%

0%

67%60%

83%

17%

0%

17%

0%

20%

40%

60%

80%

100%




Las Vegas NV Flatter Prices Not Enough to Drive Better Traffic Trends


20/55

December 14Slide 20

Las Vegas, NV Flatter Prices Not Enough to Drive Better Traffic Trends




Many tell me they don't see prices dropping, and they wantto buy before another price surge hits the market.

The majority of the current listings are grossly over priced.

Lack of inventory.

Interest rates still low. Investors are no longer a factor in our market. Buyers are

those who are relocating and moving up.

Difficult to get a loan. Seeing too many low credit scores.Lenders very cautious.

Our Take:

Housing demand in Las Vegas remains soft, as our BuyerTraffic Index edged up to 27 in December from 20 last month.Agents have seen continued resistance to higher home prices,

although lower interest rates have helped on the margin.Challenges associated with financing have slowed transactionactivity in the area as well.

Prices were flat sequentially again in December, with our PriceIndex coming in at 53 from 50 in November.

Further price appreciation may be challenging as agents sawhigher inventories and time to sell in December.

0102030405060708090

100

Dec-12

Jan-13

Feb-13

Mar-13

Apr-13

May-13

Jun-13

Jul-13

Aug-13

Sep-13

Oct-13

Nov-13

Dec-13

Jan-14

Feb-14

Mar-14

Apr-14

May-14

Jun-14

Jul-14

Aug-14

Sep-14

Oct-14

Nov-14

Dec-14

BuyerTrafficIndex


0102030405060708090

100

De

c-12

Jan-13

Feb-13

Ma

r-13

Ap

r-13

Ma

y-13

Jun-13

Ju

l-13

Aug-13

Sep-13

Oc

t-13

No

v-13

De

c-13

Jan-14

Feb-14

Ma

r-14

Ap

r-14

Ma

y-14

Jun-14

Ju

l-14

Aug-14

Sep-14

Oc

t-14

No

v-14

De

c-14

HomePriceIndex


Month

Buyer Traffic

Index

Home Price


Home Listings

Index

Time to Sell

Index

Jul-14 42.9 73.3 32.1 26.7 40.0

Aug-14 26.9 53.8 15.4 15.4 15.4

Sep-14 25.0 47.2 27.8 19.4 17.6

Oct-14 14.7 44.4 25.0 19.4 5.6

Nov-14 20.0 50.0 35.0 32.5 15.0

Dec-14 26.7 53.3 23.3 33.3 26.7

Point Change 6.7 3.3 (11.7) 0.8 11.7

7%

40%53%



33%

53% 53%

40% 47% 40%

27%

0%7%

0%

10%

20%

30%

40%50%

60%




Los Angeles CA Uptick in Traffic and Lower Inventories Help to Support Prices


21/55

December 14Slide 21

Los Angeles, CA Uptick in Traffic and Lower Inventories Help to Support Prices




Less investor purchasing.

Prices still in the summer high range. Buyers looking forbargains.

Threats from rising interest rates and low inventory have

drove some buyers. Low mortgage rates continuing and a perceived lack of

inventory.

Lack of good inventory.

Our Take:

Demand trends improved closer to agents expectations, asour Traffic Index came in at 43 in December, up from 34 inNovember. Agents highlighted low inventory levels and highprice levels for the soft traffic trends, although low rates andthe fear/expectation of higher future rates helped to bring outsome buyers and push urgency somewhat.

Prices appeared to remain flat, with our Home Price Indexticking up to 52 in December from 48 last month.

We expect modest price gains at best, as lower supply is morethan offset by soft traffic, pushing up the time to sell.

0102030405060708090

100

Dec-

12

Jan-

13

Feb-

13

Mar-

13

Apr-

13

May-

13

Jun-

13

Jul-

13

Aug-

13

Sep-

13

Oct-

13

Nov-

13

Dec-

13

Jan-

14

Feb-

14

Mar-

14

Apr-

14

May-

14

Jun-

14

Jul-

14

Aug-

14

Sep-

14

Oct-

14

Nov-

14

Dec-

14

BuyerTrafficIndex


0102030405060708090

100

De

c-12

Ja

n-13

Fe

b-13

Ma

r-13

Ap

r-13

Ma

y-13

Ju

n-13

Jul-13

Au

g-13

Se

p-13

Oc

t-13

No

v-13

De

c-13

Ja

n-14

Fe

b-14

Ma

r-14

Ap

r-14

Ma

y-14

Ju

n-14

Jul-14

Au

g-14

Se

p-14

Oc

t-14

No

v-14

De

c-14

HomePriceIndex


Month

Buyer Traffic

Index

Home Price


Home Listings

Index

Time to Sell

Index

Jul-14 34.6 55.6 52.3 29.6 17.3

Aug-14 25.6 56.6 44.4 26.9 20.3

Sep-14 24.1 39.7 50.0 31.0 17.9

Oct-14 21.7 39.7 44.4 23.3 7.1

Nov-14 33.9 48.4 45.8 43.5 27.4

Dec-14 42.6 51.9 48.0 68.0 30.0

Point Change 8.7 3.5 2.2 24.5 2.6

26%

33%

41%



22%

8%

56%59%

88%

28%19%

4%16%

0%

20%

40%

60%

80%

100%




Miami FL Traffic Continues to Disappoint as Buyers Push Back on Price


22/55

December 14Slide 22

Miami, FL Traffic Continues to Disappoint as Buyers Push Back on Price




Home prices too high. More inventory but at higher prices.

Lower priced buyers in the $300-900k range are stillresistant to the high prices. $1+ million properties are sellingwell.

Low interest rates have helped. Lack of inventory.

Our Take:

Traffic ticked up in December, with our Buyer Traffic Indeximproving to 39 from 30 in November. Agents saw the lowinterest rate environment as the main driver behind thesequential improvement. Agents noted that buyers looking forlower price point homes continue to push back on price, whilethe luxury market seems to be selling at a solid pace.

Home prices moved higher again in December, with our PriceIndex coming in at 64 from 69 last month.

Prices appreciation may slow further in the near-term as thetime on market continued to lengthen.

0102030405060708090

100

Dec-

12

Jan-

13

Feb-

13

Mar-

13

Apr-

13

May-

13

Jun-

13

Jul-

13

Aug-

13

Sep-

13

Oct-

13

Nov-

13

Dec-

13

Jan-

14

Feb-

14

Mar-

14

Apr-

14

May-

14

Jun-

14

Jul-

14

Aug-

14

Sep-

14

Oct-

14

Nov-

14

Dec-

14

BuyerTrafficIndex


0102030405060708090

100

De

c-12

Ja

n-13

Fe

b-13

Ma

r-13

Ap

r-13

Ma

y-13

Ju

n-13

Jul-13

Au

g-13

Se

p-13

Oct-13

No

v-13

De

c-13

Ja

n-14

Fe

b-14

Ma

r-14

Ap

r-14

Ma

y-14

Ju

n-14

Jul-14

Au

g-14

Se

p-14

Oct-14

No

v-14

De

c-14

HomePriceIndex


Month

Buyer Traffic

Index

Home Price


Home Listings

Index

Time to Sell

Index

Jul-14 19.2 74.0 41.7 38.0 28.8

Aug-14 32.0 78.0 45.8 44.0 45.8

Sep-14 29.0 62.9 36.7 24.1 22.6

Oct-14 25.0 66.2 43.8 31.8 20.6

Nov-14 29.6 68.5 36.0 51.9 38.9

Dec-14 38.5 63.5 34.0 52.0 34.0

Point Change 8.8 (5.1) (2.0) 0.1 (4.9)

19%

39%

42%



46%36%

48%

35%

60%

36%

19%

4%

16%

0%10%20%30%40%50%60%

70%




Minneapolis MN Price Resistance Continues to Weigh on Traffic Levels


23/55

December 14Slide 23

Minneapolis, MN Price Resistance Continues to Weigh on Traffic Levels




Increase in prices have reached 2005 levels in somepockets, price rose too far too fast.

Low interest rates and better consumer confidence havespurred more activity.

Buyers want lower pricing. Most offers are low balling.

Our Take:

Our Buyer Traffic Index bounced back in December but stillremains firmly below agents expectations. The index increasedto 35 from 15 last month. The improvement was largelycredited to better economic confidence and a favorable rateenvironment, but buyers are holding out for lower prices, assome areas are seen as close to peak price levels.

Prices were seen flat sequentially in December, as our PriceIndex came in at 47, up from 35 in November.

Home prices may be soft in the near-term as weak demand hasnot been fully offset by the recent decline in supply.

0102030405060708090

100

Dec-

12

Jan-

13

Feb-

13

Mar-

13

Apr-

13

May-

13

Jun-

13

Jul-

13

Aug-

13

Sep-

13

Oct-

13

Nov-

13

Dec-

13

Jan-

14

Feb-

14

Mar-

14

Apr-

14

May-

14

Jun-

14

Jul-

14

Aug-

14

Sep-

14

Oct-

14

Nov-

14

Dec-

14

BuyerTrafficIndex


0102030405060708090

100

De

c-12

Ja

n-13

Fe

b-13

Ma

r-13

Ap

r-13

Ma

y-13

Ju

n-13

Jul-13

Au

g-13

Se

p-13

Oct-13

No

v-13

De

c-13

Ja

n-14

Fe

b-14

Ma

r-14

Ap

r-14

Ma

y-14

Ju

n-14

Jul-14

Au

g-14

Se

p-14

Oct-14

No

v-14

De

c-14

HomePriceIndex


Month

Buyer Traffic

Index

Home Price


Home Listings

Index

Time to Sell

Index

Jul-14 31.8 59.1 45.5 31.8 40.9

Aug-14 26.9 57.7 46.2 33.3 26.9

Sep-14 27.8 41.7 27.8 27.8 16.7

Oct-14 32.1 50.0 39.3 39.3 21.4

Nov-14 15.4 34.6 41.7 42.3 20.8

Dec-14 35.3 47.1 35.3 61.8 29.4

Point Change 19.9 12.4 (6.4) 19.5 8.6

23%

24%

53%



29% 29%

59%

35%

71%

24%

35%

0%

18%

0%

20%

40%

60%

80%




Nashville TN Traffic Improves and Meets Expectations as Prices March Higher


24/55

December 14Slide 24

Nashville, TN Traffic Improves and Meets Expectations as Prices March Higher




There is some pent-up demand and has been a littleimprovement in the economy.

Lower than normal inventory of entry level homes havediscouraged buyers.

Fewer looking but those looking are buying now. Activity began slowing.

Our Take:

Traffic improved and essentially met expectations in December,as our Traffic Index increased to 46 from 31 in November.While a seasonal slower time, agents were encouraged bysome serious buyers acting quickly. Inventory levels at lowerprice points have continued to frustrate some buyers, though.

Prices continued to move higher in December, with our HomePrice Index coming in at 65 from 69 in November.

We think prices in Nashville will likely continue to rise, ashomes have been moving quicker when brought to market andinventories have continued to contract in recent months.

0102030405060708090

100

Dec-

12

Jan-

13

Feb-

13

Mar-

13

Apr-

13

May-

13

Jun-

13

Jul-

13

Aug-

13

Sep-

13

Oct-

13

Nov-

13

Dec-

13

Jan-

14

Feb-

14

Mar-

14

Apr-

14

May-

14

Jun-

14

Jul-

14

Aug-

14

Sep-

14

Oct-

14

Nov-

14

Dec-

14

BuyerTrafficIndex


0102030405060708090

100

De

c-12

Ja

n-13

Fe

b-13

Ma

r-13

Ap

r-13

Ma

y-13

Ju

n-13

Jul-13

Au

g-13

Se

p-13

Oct-13

No

v-13

De

c-13

Ja

n-14

Fe

b-14

Ma

r-14

Ap

r-14

Ma

y-14

Ju

n-14

Jul-14

Au

g-14

Se

p-14

Oct-14

No

v-14

De

c-14

HomePriceIndex


Month

Buyer Traffic

Index

Home Price


Home Listings

Index

Time to Sell

Index

Jul-14 31.8 61.1 43.8 61.1 55.6

Aug-14 45.8 68.2 54.5 68.2 59.1

Sep-14 36.4 63.6 45.5 68.2 36.4

Oct-14 36.4 66.7 50.0 68.2 41.7

Nov-14 31.3 68.8 62.5 56.3 56.3

Dec-14 46.2 65.4 54.2 75.0 62.5

Point Change 14.9 (3.4) (8.3) 18.8 6.3

23%

46%

31%



31%

8%17%

69%75%

42%

0%

17%

42%

0%

20%

40%

60%

80%




New York-Northern NJ Traffic Remains Slow on Low Inventories and Buyer Price Resistance


25/55

December 14Slide 25

New York-Northern NJ Traffic Remains Slow on Low Inventories and Buyer Price Resistance




Lack of inventory, uncertainty.

Rates still low investors looking for foreclosure deals.

Overpriced inventory.

Low interest rates and rising prices drove some pickup in

activity. The traffic now is worse than in 2009 into 2010.

Lack of good quality listing inventory.

Buyers are still looking for unrealistic bargains.

Buyers still concerned over job market.

Our Take:

Traffic improved sequentially but remained well below agentsexpectations in December, with our Traffic Index coming in at26 from 19 in November. Low inventory levels and buyerresistance to higher prices were the most commonly cited

reasons for slow traffic, with many buyers seemingly only outthere looking for bargain properties.

Prices slipped again in December, with our Home Price Indexcoming in at 43 vs. 39 in November.

Time to sell lengthened in December, which could lead to acontinuation of lackluster pricing trends as traffic remains soft,although lower inventories should help provide some support.

0102030405060708090

100

Dec-

12

Jan-

13

Feb-

13

Mar-

13

Apr-

13

May-

13

Jun-

13

Jul-

13

Aug-

13

Sep-

13

Oct-

13

Nov-

13

Dec-

13

Jan-

14

Feb-

14

Mar-

14

Apr-

14

May-

14

Jun-

14

Jul-

14

Aug-

14

Sep-

14

Oct-

14

Nov-

14

Dec-

14

BuyerTrafficIndex


0102030405060708090

100

De

c-12

Ja

n-13

Fe

b-13

Ma

r-13

Apr-13

Ma

y-13

Ju

n-13

Jul-13

Au

g-13

Se

p-13

Oct-13

No

v-13

De

c-13

Ja

n-14

Fe

b-14

Ma

r-14

Apr-14

Ma

y-14

Ju

n-14

Jul-14

Au

g-14

Se

p-14

Oct-14

No

v-14

De

c-14

HomePriceIndex


Month

Buyer Traffic

Index

Home Price


Home Listings

Index

Time to Sell

Index

Jul-14 23.8 52.5 58.8 36.3 24.4

Aug-14 24.5 46.9 50.0 46.1 36.3

Sep-14 19.0 41.9 55.6 36.0 31.0

Oct-14 18.6 41.7 58.6 52.3 35.4

Nov-14 18.6 39.3 52.8 59.8 34.5

Dec-14 25.6 42.6 50.0 71.3 33.0

Point Change 7.0 3.3 (2.8) 11.5 (1.5)

9%

33%58%



11% 8%

45%

64%

85%

45%

26%

8% 11%

0%

20%

40%

60%

80%

100%




Orlando FL Buyer Traffic Steps Back as Inventories Grow and Nudge Prices Lower


26/55

December 14Slide 26

Orlando, FL Buyer Traffic Steps Back as Inventories Grow and Nudge Prices Lower




Inventory is up and prices have started to fall.

Difficulty obtaining mortgages.

Mostly buyers that have to move are looking. Some arealready priced out of the market that they could qualify for.

We are up from the stats this time last year, for an overallmarket improvement.

Our Take:

Traffic pulled back in December, with our index slipping to 28from 41 in November. Agents noted that home price levelshave put off buyers generally, with some completely priced outof areas that they would like to be looking, although it wasnoted by some that this year seems to be better than last year.

Our Home Price Index were seen modestly lower for the firsttime in over a year as indicated by a 45 reading for December.

The time needed to sell and inventory levels continued to rise,suggesting home prices may face ongoing resistance,especially if demand remains soft.

0102030405060708090

100

Dec-12

Jan-13

Feb-13

Mar-13

Apr-13

May-13

Jun-13

Jul-13

Aug-13

Sep-13

Oct-13

Nov-13

Dec-13

Jan-14

Feb-14

Mar-14

Apr-14

May-14

Jun-14

Jul-14

Aug-14

Sep-14

Oct-14

Nov-14

Dec-14

BuyerTrafficIndex


0102030405060708090

100

De

c-12

Ja

n-13

Fe

b-13

Mar-13

Apr-13

Ma

y-13

Ju

n-13

Jul-13

Au

g-13

Se

p-13

Oct-13

No

v-13

De

c-13

Ja

n-14

Fe

b-14

Mar-14

Apr-14

Ma

y-14

Ju

n-14

Jul-14

Au

g-14

Se

p-14

Oct-14

No

v-14

De

c-14

HomePriceIndex


Month

Buyer Traffic

Index

Home Price


Home Listings

Index

Time to Sell

Index

Jul-14 42.3 57.1 41.7 42.9 42.9

Aug-14 20.8 50.0 35.0 45.5 31.8

Sep-14 27.8 66.7 38.9 50.0 33.3

Oct-14 38.9 55.6 25.0 55.6 33.3

Nov-14 40.9 63.6 30.0 45.5 40.9

Dec-14 27.8 45.0 30.0 20.0 25.0

Point Change (13.1) (18.6) 0.0 (25.5) (15.9)

0%

56%

44%



10%

40%50%

70%

60% 50%

20%

0% 0%0%

20%

40%

60%

80%




Philadelphia PA-Southern NJ Weakness on Lower End Keeps Overall Traffic Level Below Expectations


27/55

December 14Slide 27

Philadelphia, PA Southern NJ Weakness on Lower End Keeps Overall Traffic Level Below Expectations


(6,223 single-family building permits in 2013, 23rd largest market in the country)


More buyers getting ready to make moves after the first ofthe year.

It is slow - buyers seem to have disappeared.

Lack of confidence.

The job market for first-time buyers remains soft. High-end properties are moving rather quickly.

Our Take:

Traffic ticked up in December but remains below agentsexpectations as indicated by our Buyer Traffic Index landing at29 from 24 in November. Overall, agents noted that localeconomic weakness continues hinder buyer confidence,particularly for first-time buyers as the entry level job marketseem to be soft in the Philadelphia area.

Prices were lower in December, as our Price Index came in at39, similar to the reading of 38 seen in November.

Inventory levels fell in December, but the time to selllengthened for the 3rdconsecutive month.

0102030405060708090

100

Dec-12

Jan-13

Feb-13

Mar-13

Apr-13

May-13

Jun-13

Jul-13

Aug-13

Sep-13

Oct-13

Nov-13

Dec-13

Jan-14

Feb-14

Mar-14

Apr-14

May-14

Jun-14

Jul-14

Aug-14

Sep-14

Oct-14

Nov-14

Dec-14

BuyerTrafficIndex


0102030405060708090

100

De

c-12

Ja

n-13

Fe

b-13

Mar-13

Apr-13

Ma

y-13

Ju

n-13

Jul-13

Au

g-13

Se

p-13

Oct-13

No

v-13

De

c-13

Ja

n-14

Fe

b-14

Mar-14

Apr-14

Ma

y-14

Ju

n-14

Jul-14

Au

g-14

Se

p-14

Oct-14

No

v-14

De

c-14

HomePriceIndex


Month

Buyer Traffic

Index

Home Price


Home Listings

Index

Time to Sell

Index

Jul-14 25.0 38.5 59.1 41.7 38.5

Aug-14 32.4 50.0 41.2 52.9 50.0

Sep-14 36.8 39.5 52.8 38.9 47.4

Oct-14 26.5 29.4 50.0 35.3 32.4

Nov-14 23.5 38.2 50.0 38.2 35.3

Dec-14 29.2 38.5 36.4 61.5 38.5

Point Change 5.6 0.2 (13.6) 23.3 3.2

8%

42%

50%



0%

36%31%

77%

55% 62%

23%

9% 8%

0%

20%

40%

60%

80%

100%




Phoenix, AZ Buyers Willing to Wait for Lower Prices and Stay Put For Now


28/55

December 14Slide 28

Phoenix, AZ Buyers Willing to Wait for Lower Prices and Stay Put For Now




Buyers are sitting on the sideline; sellers still think they canbe aggressive with pricing, but buyers are clearly rejectinganything that doesn't seem reasonable.

New home buyers don't seem to qualify with lenders.

Some pickup in investor activity while prices are affordableand rents favorable.

Some sellers are listing homes at high prices then slowlylower them to keep buyers interested in price reductions.

Lack of buyers in the market.

Our Take:

Buyer traffic levels ticked up sequentially but remained wellbelow agents expectations in December, as our Buyer TrafficIndex came in at 25, up from 13 in November. Agents indicatebuyers are willing to wait for lower prices rather than pay what

are perceived to be unreasonable prices. Some suggestedsellers have been more open to price negotiations.

Home prices slipped again in December, with our Price Indexcoming in at 29 from 26 in November.

We think prices will likely face continued pressure in thecoming months, as inventories grow and traffic levels have yetto see a meaningful improvement.

0102030405060708090

100

Dec-12

Jan-13

Feb-13

Mar-13

Apr-13

May-13

Jun-13

Jul-13

Aug-13

Sep-13

Oct-13

Nov-13

Dec-13

Jan-14

Feb-14

Mar-14

Apr-14

May-14

Jun-14

Jul-14

Aug-14

Sep-14

Oct-14

Nov-14

Dec-14

BuyerTrafficIndex


0102030405060708090

100

De

c-12

Ja

n-13

Fe

b-13

Mar-13

Apr-13

Ma

y-13

Ju

n-13

Jul-13

Au

g-13

Se

p-13

Oct-13

No

v-13

De

c-13

Ja

n-14

Fe

b-14

Mar-14

Apr-14

Ma

y-14

Ju

n-14

Jul-14

Au

g-14

Se

p-14

Oct-14

No

v-14

De

c-14

HomePriceIndex


Month

Buyer Traffic

Index

Home Price


Home Listings

Index

Time to Sell

Index

Jul-14 16.7 32.7 21.2 36.0 11.5

Aug-14 16.1 30.6 25.9 40.3 14.5

Sep-14 15.6 37.5 26.6 46.9 19.4

Oct-14 19.6 21.4 28.6 30.4 9.3

Nov-14 12.9 25.8 28.3 37.1 11.3

Dec-14 25.0 28.6 37.9 38.6 16.2

Point Change 12.1 2.8 9.5 1.5 4.9

8%

33%

59%



6%

33%

71%

46%58%

26%

49%

9%3%

0%

20%

40%

60%

80%




Portland, OR Pick Up in Buyer Urgency Helps Propel Prices Higher


29/55

December 14Slide 29

Portland, OR Pick Up in Buyer Urgency Helps Propel Prices Higher




Favorable interest rates.

Trying to beat additional price increases.

Anticipation of higher interest rates have motivated buyersto move now.

About 1/3 of my clients are buying a second home inPortland.

Slow down in economy.

Our Take:

Traffic remained solid and was in-line with agents expectationsin December, with our index coming in at 54 from 57 inNovember. Agents largely attributed the solid reading tofavorable mortgage rates. Some saw increased buyer urgencythan in prior months, as fears of rising prices and rates grew.

Prices continue to move higher in Portland, as our Price Indexcame in at 64 in December vs. 68 in November.

Agents indicated that inventory continued to contract inDecember, while the time to sell held flatpositive leadingindicators for near-term home price trends.

0102030405060708090

100

Dec-12

Jan-13

Feb-13

Mar-13

Apr-13

May-13

Jun-13

Jul-13

Aug-13

Sep-13

Oct-13

Nov-13

Dec-13

Jan-14

Feb-14

Mar-14

Apr-14

May-14

Jun-14

Jul-14

Aug-14

Sep-14

Oct-14

Nov-14

Dec-14

BuyerTrafficIndex


0102030405060708090

100

De

c-12

Ja

n-13

Fe

b-13

Mar-13

Apr-13

Ma

y-13

Ju

n-13

J

ul-13

Au

g-13

Se

p-13

O

ct-13

No

v-13

De

c-13

Ja

n-14

Fe

b-14

Mar-14

Apr-14

Ma

y-14

Ju

n-14

J

ul-14

Au

g-14

Se

p-14

O

ct-14

No

v-14

De

c-14

HomePriceIndex


Month

Buyer Traffic

Index

Home Price


Home Listings

Index

Time to Sell

Index

Jul-14 41.7 75.0 45.8 45.8 70.8

Aug-14 30.0 63.3 50.0 43.3 60.0

Sep-14 37.5 62.5 50.0 37.5 37.5

Oct-14 36.4 63.6 45.5 50.0 40.9

Nov-14 56.7 67.9 50.0 73.3 43.3

Dec-14 53.8 64.3 42.3 57.1 50.0

Point Change (2.8) (3.6) (7.7) (16.2) 6.7

23%

62%

15%



36%

15%29%

57%

85%

43%

7%0%

29%

0%

20%

40%

60%

80%

100%




Raleigh, NC Improving Local Economy and Tight Inventory Push Prices Higher


30/55

December 14Slide 30

Raleigh, NC Improving Local Economy and Tight Inventory Push Prices Higher




Renewed confidence in local economy is helping buyerspull the trigger.

Shortage of affordable inventory.

Few housing choices and a very tight market.

Lack of available financing.

Our Take:

Traffic improved and was roughly in-line with expectations forDecember, with our Traffic Index increasing to 45 from 38 inNovember. Agents indicated that a better local economyhelped drive some improvement in demand over the pastmonth. However, affordable supply remains constrained,limiting overall sales levels in Raleigh.

Prices moved moderately higher in December, as our HomePrice Index increased to 65 from 62 in November.

Inventories fell in December and the length of time needed tosell was unchanged, which should support home prices.

0102030405060708090

100

Dec-12

Jan-13

Feb-13

Mar-13

Apr-13

May-13

Jun-13

Jul-13

Aug-13

Sep-13

Oct-13

Nov-13

Dec-13

Jan-14

Feb-14

Mar-14

Documents

CS Realtor Survey January 2015