FAIRLY STABLE BUT AT A WEAK LEVEL

New Home Sales Monday November 28, 2011

20 10 400 Monthly % Change 0 -10 -20 300 -30 -40 Oct-09 Jan-10 Apr-10 Jul-10 Oct-10 Jan-11 Apr-11 Jul-11 Oct-11
Monthly % Change Sales (Thousands of Units)

450

Thousands of Units

350

250

Record High: 1389k (07/05)

Percent Change from Record High: -77.9%

New home sales rose 1.3% in October to an annualized pace of 307k, less than market expectations for a bigger gain to an annual rate of 315k. New home sales are counted when the sales contract is signed so these data reflect current sales activity. New home sales are 8.9% above their year ago level but remain a stunning 77.9% below their peak level reached in July 2005. At just over a 300k annual rate, new home sales remain quite weak. Regionally, sales were mixed with solid gains in the Midwest and West, a decline in the South and unchanged level in the Northeast. New home sales in all areas of the country remain about 50% lower than their 5-year annual average. The inventory of new homes available for sale was unchanged at a record low level of 162k which represents a 6.3 month-supply at the current sale pace. Such low inventory levels will support pricing and the potential for new residential construction when demand strengthens. Home prices were mixed from one year ago with the median price for a new home up 4.0% to $212,300 as average prices fell 4.8% to $242,300. New home prices are hovering around their lowest levels since late 2003 and early 2004. New home sales, like other housing market indicators, are fairly stable at a weak level. The outlook is for the weakness to continue. Demand for new homes remains constrained by slow job growth and still tight credit conditions. It would be a rebound in the broader economy that would restore demand drivers and get homebuilding and new home sales back on track, the timing of which is still uncertain. THOUSANDS OF UNITS
Forecast: Consensus*: Actual: 310k 315k 307k Monthly Oct-11 307 1.3 22 0.0 55 22.2 153 -9.5 77 14.9 162 6.3 212.3 4.0 242.3 -4.8 Sep-11 303 3.4 22 -12.0 45 -8.2 169 8.3 67 6.3 162 6.4 213.3 -6.4 248.4 -8.3 Aug-11 293 -0.7 25 8.7 49 6.5 156 -4.3 63 0.0 163 6.7 217.6 -4.0 257.6 -4.2 Jul-11 295 -2.6 23 43.8 46 2.2 163 -4.7 63 -11.3 166 6.8 229.9 8.4 270.3 7.2 Three Month 301 Six Month 302 Twelve Month 303 Average for 2010 321 -14.1 31 -2.7 45 -17.7 173 -14.5 74 -15.3 190 8.0 221.2 3.1 271.5 1.2 2009 374 -22.4 31 -11.1 54 -21.8 202 -23.8 87 -22.9 234 9.0 214.5 -6.9 268.2 -7.2 Five Year 599 Ten Year 845

New Home Sales (percent change) Northeast (percent change) Midwest (percent change) South (percent change) West (percent change) Inventory Months of Supply Median Sales Price ($000) (year-on-year % change) Average Sales Price ($000) (year-on-year % change)

23 50 159 69

21 47 164 69

23 42 166 73

45 89 321 143

60 140 421 224

162 6.5 214.4 -2.4 249.4 -5.8

165 6.6 222.6 1.1 259.1 -1.9

174 6.9 225.1 2.5 266.3 -1.3

362 8.5 230.6

376 6.3 215.4

288.2

268.2

Source: Bureau of the Census, Department of Commerce Via Haver Analytics. Data, graph & table courtesy of Insight Economics *Bloomberg 2011 HousingMatrix, Inc.| http://www.HousingMatrix.com | All rights reserved. Reproduction and/or redistribution are expressly prohibited. Hot Sheet is a registered trademark of HousingMatrix, Inc. Information contained herein is based on sources believed to be reliable, but accuracy is not guaranteed.