KCM Divided into Three Sections

FHFA Regional Home Prices (year-over-year)

FHFA 2013 1Q HPI Report

2013 1Q

2012 2Q 2012 3Q

2012 4Q

FHFA State Home Prices (year-over-year)

FHFA 2013 1Q HPI Report

Buyers Raising Their Offers

HousingWire 5/2013

26%

34%

41%

0%

5%

10%

15%

20%

25%

30%

35%

40%

45%

2012 4Q 2013 1Q 2013 2Q

The percentage of buyers considering

paying more for a home now than 90 days

ago because of low inventory.

Signs of New

Housing Bubble

in Several Areas

- CNN May 17th

91% of Regions are

UNDERVALUED

Undervalued Overvalued

91%

9%

Trulia 5/2013

# U.S. Metro 2013 Q2 At Peak

1 Orange County +9% +71%

2 Austin +7% +12%

3 San Antonio +5% +12%

4 Los Angeles +5% +78%

5 San Jose +3% +59%

6 San Francisco +2% +52%

Home Prices Relative to Fundamentals

Trulia 5/2013

So are we in

bubble territory?

NO!

Bubble-phobes can rest

easy. Even with recent sharp

home price increases, prices

are still low relative to

fundamentals and are far

below bubble levels. Jed Kolko Trulia Chief Economist

“Even if double-digit price appreciation were to

continue in former bubble metro areas, there is no

reason to believe that new home price bubbles

are forming. That’s because single-family homes

in these markets are still very affordable, even after

last year’s large price gains.”

Dr. David Stiff, Chief Economist for CoreLogic Case-Shiller

Housing Bubble?

Housing Boosts Economy

HousingWire 5/2013

Housing touches homebuilders, mortgage finance,

construction companies & services, general

contractors, construction supplies & fixtures, raw

materials, home furnishing and appliances and

related retail companies.

“Because of large reliance labor, the economic

multiplier to the housing sector has been high.”

NewOak CEO Ron D’Vari

Real Estate

THE ‘JUICE’

of Recovery

“We forecast that

housing starts will

increase by about

200,000 units in 2013,

which would support

over 100,000 new jobs

in construction alone.”

Frank E. Nothaft

Chief Economist at Freddie Mac

5/2013

Economic Impact of a Home Sale

NAR 5/2013

Home Price Expectation Survey

Home Price

Expectation

Survey

A nationwide panel

of over one hundred

economists, real

estate experts and

investment & market

strategists.

3.6%

10.4%

-5.8%

4.3% 4.1%

-6.0%

-4.0%

-2.0%

0.0%

2.0%

4.0%

6.0%

8.0%

10.0%

12.0%

Pre-Bubble (1987-1999)

Bubble (Jan '00-Apr '07)

Bust (May '07-Oct '11)

Recovery to Date (Nov '11-Mar '13 )

Expectations (2013-2017)

Average Annual Appreciation

Home Price Expectation Survey 5/2013

5.4

4.2

3.73.5 3.5

0

1

2

3

4

5

6

7

2013 2014 2015 2016 2017

Home Price Expectation Survey

Projected Percentage Increase

Home Price Expectation Survey 5/2013

Percentage Appreciation by Survey

Home Price Expectation Survey 5/2013

3.53.8

2.2

2.9

1.3

2.5

5.4

4.4

0

0.5

1

1.5

2

2.5

3

3.5

4

4.5

5

5.5

6

6.5

7

2013 2014

3 Years Ago 2 Years Ago 1 Year Ago Now

Home Price Expectation Survey 5/2013

Cumulative Appreciation by 2017

22.3%

32.8%

22.3%

12.3%

0.0%

10.0%

20.0%

30.0%

40.0%

Pre-Bubble Trend Bulls All Projections Bears

What a Homeowner Should Know Before FSBOing

90% of all buyers search online during

their home buying process

of all buyers purchased their home

through a real estate agent 89%

The % of homes selling as a FSBO has

decreased in 20 years from 19% to 9%.

of all buyers look to print newspaper

ads as an offline resource 28%

TYPICAL SOLD PRICE*

Sources: NAR, Google

BY FSBO

$174,900

BY AGENT

$215,000

*The ‘typical’ price is actually the average price in the survey.

However, studies have shown that people are more likely to

FSBO in markets with lower price points.

FSBOs Must Be Ready to Negotiate

Here is a list of some of the people with

whom you must be prepared to negotiate:

• The buyer

• The buyer’s agent

• The buyer’s attorney

• The home inspection company

• The termite company

• The buyer’s lender

• The appraiser

• The title company

• The town or municipality

• The buyer’s buyer

• Your bank (in the case of a short sale)

Seller’s

Possible Perception of Value

Buyer’s

Possible Perception of Value

Appraiser’s Possible Perception of Value

Appraisal Challenges

MSN Money.com, Case Shiller

38.2

16.9

-12.3

48.7

-30

-10

10

30

50

Dow S&P NASDAQ Real Estate

January 2000 – June 2013

Return on Investment

90

95

100

105

110

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr

Pending Home Sales

NAR 3/2013

100 = Historically Healthy Level

NAR 5/2013

January 2012 – December 2012

January 2011 – December 2011

80

90

100

110

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

2013 2012 2011

100 = Historically Healthy Level

Pending Home Sales

Months Inventory of Homes for Sale

4.0

5.0

6.0

7.0

8.0

9.0

10.0

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr

NAR 5/2013

5-6 Months = Normal Market Inventory

S&P Case-Shiller Home Price Indices

S&P Case Shiller 5/2013

-3.9%-3.5%

-2.5%

-1.7%

-0.5%

0.6%1.1%

2.0%

3.6%4.3%

5.5%

6.8%

8.1%

9.3%

10.2%

-6.0%

-4.0%

-2.0%

0.0%

2.0%

4.0%

6.0%

8.0%

10.0%

12.0%

Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar

Year-over-Year Change in Prices

Jan Feb Mar Apr May

S&P Case Shiller 4/2013

S&P Case-Shiller Home Price Indices

Metropolitan Area Year-over-Year

Atlanta 19.1%

Boston 6.7%

Charlotte 7.3%

Chicago 7.8%

Cleveland 4.8%

Dallas 6.8%

Denver 9.8%

Detroit 18.5%

Las Vegas 20.6%

Los Angeles 16.6%

Metropolitan Area Year-over-Year

Miami 10.7%

Minneapolis 12.5%

New York 2.6%

Phoenix 22.5%

Portland 12.8%

San Diego 12.1%

San Francisco 22.2%

Seattle 10.6%

Tampa 11.8%

Washington 7.7%

S&P Case-Shiller Home Price Indices

S&P Case Shiller 5/2013

Home Prices in the Short Term

130.00

135.00

140.00

145.00

150.00

May June July Aug Sept Oct Nov Dec Jan Feb Mar Apr May

2010-11

2011-12

2012-13

S&P Case Shiller 5/2013

3.25

3.5

3.75

4

4.25

30 Year Fixed Rate Mortgage History

1/2012 – 5/2013

Federal Reserve 5/2013

3.3

3.35

3.4

3.45

3.5

3.55

3.6

3.65

3.7

3.75

3.8

3.85

1/3 1/10 1/17 1/24 1/31 2/7 2/14 2/21 2/28 3/7 3/14 3/21 3/28 4/4 4/11 4/18 4/25 5/2 5/9 5/16 5/23 5/30

Rate 3.34 3.4 3.38 3.42 3.53 3.53 3.53 3.56 3.51 3.52 3.63 3.53 3.57 3.54 3.43 3.41 3.4 3.35 3.42 3.51 3.59 3.81

Recent Rate Movement

30 Year Fixed Rate Mortgage

2013

Analyst Projected Rate

This Time Next Year

Mortgage Bankers Assoc 4.3%

Fannie Mae 4%

National Assoc of Realtors 4.6%

Mortgage Rate Projections

LPS & NAR 5/2013

15%

20%

25%

30%

35%

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr

Percentage of Distressed Property Sales

35%

18%

April month-end data shows delinquency

rate below 6.5 percent for first time since

July 2008; foreclosure inventory down

nearly 25 percent year-over-year. - LPS

MARKETING

Opening Doors with

POWERFUL

MARKETING

What a Homeowner Should Know Before FSBOing

90% of all buyers search online during

their home buying process

of all buyers purchased their home

through a real estate agent 89%

The % of homes selling as a FSBO has

decreased in 20 years from 19% to 9%.

of all buyers look to print newspaper

ads as an offline resource 28%

TYPICAL SOLD PRICE*

Sources: NAR, Google

BY FSBO

$174,900

BY AGENT

$215,000

*The ‘typical’ price is actually the average price in the survey.

However, studies have shown that people are more likely to

FSBO in markets with lower price points.

Thinking of Selling

on Your Own?

and

CONS

PROS

Realize there are

What Does This Mean to You?

Freddie Mac 5/2013

30 Year Fixed

Rate Mortgage

This Year

Is the Fed Causing a Housing Bubble?

Where Are Home Prices Headed?

Resources

KEEPINGCURRENTMATTERS.COM

Slide Slide Title Link

4,6 FHFA Regional Home Prices, FHFA

State Home Prices http://www.fhfa.gov/webfiles/24216/q22012hpi.pdf

7 Buyers Raising Their Offers http://www.housingwire.com/rewired/2013/05/23/offers-remain-high-even-depreciating-

markets

8 Signs of New Housing Bubble http://finance.fortune.cnn.com/2013/05/17/housing-bubble/

9,10,11

91% of Regions are Undervalued, Home

Prices Relative to Fundamentals, So Are

We In Bubble Territory?

http://trends.truliablog.com/2013/05/trulia-bubble-watch/

12 Housing Bubble http://www.corelogic.com

13 Housing Boasts Economy http://www.housingwire.com/news/2013/05/20/housing-begins-directly-contribute-economy

14 Real Estate THE ‘JUICE’ of Recovery http://www.freddiemac.com/news/finance/docs/May_2013_public_outlook.pdf

15 Economic Impact of a Home Sale http://www.realtor.org/reports/state-by-state-economic-impact-of-real-estate-activity

16,17,

18,19,

20,21

Home Price Expectation Survey, Average

Annual Appreciation, Percentage

Appreciation by Survey, Cumulative

Appreciation by 2017

https://www.pulsenomics.com/uploads/Q12013_ZHPES_Press_Release_Final.pdf

22, 40 What a Homeowner Should Know Before

FSBOing www.realtor.org

Resources Slide Slide Title Link

27,28,

29

Pending Home Sales, Month’s

Inventory of Homes for Sale http://www.realtor.org

30 S&P Case Shiller Home Price Indices http://www.housingviews.com/wp-content/uploads/2013/05/CSHomePrice_Release_March-

Qtr1-Results.pdf

32,33

S&P Case Shiller Home Price

Indices, Home Prices in the Short

Term

http://www.standardandpoors.com/indices/articles/en/us/?articleType=PDF&assetID=12453467

89036

34,35 30 Year Fixed Rate Mortgage

History, Recent Rate Movement http://www.freddiemac.com/pmms

36 Mortgage Rate Projections

http://www.marketwatch.com/story/mortgage-rates-will-rise-next-year-but-slowly-2012-10-24

http://www.realtor.org/sites/default/files/reports/2013/embargoes/phs-3-37-nbmtwr/april-2013-

outlook-2013-03-27.pdf

http://www.fanniemae.com/resources/file/research/emma/pdf/Housing_Forecast_041713.pdf

37 Percentage of Distressed Property

Sales http://www.realtor.org

42 What Does This Mean to You? http://www.freddiemac.com/pmms

43 Is the Fed Causing a Housing

Bubble?

http://www.dsnews.com/articles/experts-see-risk-of-housing-bubble-resulting-from-fed-policies-

2013-05-07

KEEPINGCURRENTMATTERS.COM

“The minute real estate listings

went online was the minute

that it was no longer sufficient

that a real estate broker

merely had information

about real estate listings.”

Seth Godin

“Information is in a hurry to flow, and if

someone comes up with a better, more direct,

faster and cheaper way for information to get

from one place to another,

they will eliminate your

reason for being.”

The alternative, while difficult,

is obvious: provide enough

non-commodity service and

customization that it doesn't

matter if the ideas spread.

In fact, it will help

you when they do.