ATLANTA HOUSING MARKET Fourth Quarter 2017 Presentation for HBA Builder Developer Lender Council. Expanded. Unemployment Rate (U 6) Official

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Eugene James Senior Regional Director 404-510-1080 ejames@metrostudy.

com To volunteer call 404 408 0716 ATLANTA HOUSING MARKET Fourth Quarter 2017 Presentation for HBA Builder Developer Lender

1 Eugene James Senior Regional Director connect on LinkedIn Mike Overley Business Development Director To volunteer call ATLANTA HOUSING MARKET Fourth Quarter 2017 Presentation for HBA Builder Developer Lender Council 1 U.S. Unemployment Rates % 15.0% 13.0% 11.0% 9.0% Expanded Unemployment Rate (U 6) 8.0% 7.0% 5.0% Official Unemployment Rate 4.1% 3.0% Source: U. S. Bureau of Labor Statistics 2 1

2 Consumer Confidence Index, Present GROWTH STATIC RECESSION Q01 4Q02 4Q03 4Q04 4Q05 4Q06 4Q07 4Q08 4Q09 4Q10 4Q11 4Q12 4Q13 4Q14 4Q15 4Q16 4Q17 Source: Conference Board Unemployment Rate & Consumer Confidence Index Unemployment Rate & Consumer Confidence Index Present Situation Unemployment rate 10.0% 9.3% 8.6% 7.9% 7.2% 6.5% 5.8% 5.1% 4.4% 3.7% 3.0% Source: Conference Board, U.S. Bureau of Labor Statistics 2

Atlanta Employment Source: ARC 5 Million 2.8 2.7 2.6 METRO ATLANTA TOTAL EMPLOYMENT HISTORY Record High for total people employed!

3 Atlanta Employment Source: ARC 5 Million METRO ATLANTA TOTAL EMPLOYMENT HISTORY Record High for total people employed! Atlanta s Job Growth (2%) has been stronger than the nations (1.4%) for the last five years, But recently it has slowed million UP 2.0% Dec-17 Dec-16 Dec-15 Dec-14 Dec-13 Dec-12 Dec-11 Dec-10 Dec-09 Dec-08 Dec-07 Dec-06 Dec-05 Dec-04 Dec-03 Dec million people employed in Atlanta. Represents 62% of all Georgia employment (4.5 million employed in the State) 6 3

4 Metro Atlanta Unemployment rate is 4.2% (Dec 2017) 7 Atlanta Annual Job Growth 67% of all jobs METRO created ATLANTA in the State (29 were county) in Metro Atlanta 55,600 ANNUAL RATE OF NON-AG NEW JOB GROWTH UP 2.0% YoY Dec-17 Dec-16 Dec-15 Dec-14 Dec-13 Dec-12 Dec-11 Dec-10 Dec-09 Dec-08 Dec-07 Dec-06 Dec-05 Dec-04 Dec

5 ATLANTA EMPLOYMENT by Sector YoY NET JOBS year over year 20,000 16,200 15,000 13,300 10,000 9,500 5,000 5,800 2,900 1,400 3,200 4, ,000-1,200 Education-Health Prof & Bus services Finance Information Trade-trans Manfg Construction 4.9% 0.7% 0.5% 1.4% 1.9% 3.2% 3.9% 2.5% 1.4% Leisure-other servcs Government 9 Percent of Jobs by Sector 12/31/2017 Government, 12% Construction 4% Manfg 6% Leisure, Hospitality other servcs 15% Trade trans 22% Education Health 13% Prof & Bus services 19% Information 4% Finance 6% 2,791,400 million jobs in Metro Atlanta. Up 2.0% 10 5

Dallas Fort Worth Arlington, TX New York Newark Jersey City, NY NJ PA Los Angeles Long Beach Anaheim, CA Miami Fort Lauderdale West Palm Beach, Seattle Tacoma Bellevue, WA Atlanta Sandy Springs

6 Dallas Fort Worth Arlington, TX New York Newark Jersey City, NY NJ PA Los Angeles Long Beach Anaheim, CA Miami Fort Lauderdale West Palm Beach, Seattle Tacoma Bellevue, WA Atlanta Sandy Springs Roswell, GA Washington Arlington Alexandria, DC VA Riverside San Bernardino Ontario, CA Orlando Kissimmee Sanford, FL Minneapolis St. Paul Bloomington, MN WI Houston The Woodlands Sugar Land, TX San Francisco Oakland Hayward, CA Phoenix Mesa Scottsdale, AZ San Antonio New Braunfels, TX Detroit Warren Dearborn, MI Chicago Naperville Elgin, IL IN WI Portland Vancouver Hillsboro, OR WA Austin Round Rock, TX Las Vegas Henderson Paradise, NV Denver Aurora Lakewood, CO Tampa St. Petersburg Clearwater, FL Philadelphia Camden Wilmington, PA NJ San Jose Sunnyvale Santa Clara, CA Sacramento Roseville Arden Arcade, CA Nashville Davidson Murfreesboro Source: US Bureau of Labor Statistics Top 25 US Job Growth Markets (December 2017 over December 2016 Non Farmy Employment Grow 0 10,000 20,000 30,000 40,000 50,000 60,000 70,000 80,000 90, , Atlanta Apartment Market Growing population (including millennial growth) and thriving employment keeping the multifamily market healthy, But its starting to slow 12 6

Top MSAs Ranked by Annual Multi-Family Permits as of Dec 2017 Annual Multi Annual Population Rank MSA Family Permits Change Estimate 1 New York Newark Jersey City, NY NJ PA 38,503 8,518 20,257,610 2

7 Top MSAs Ranked by Annual Multi-Family Permits as of Dec 2017 Annual Multi Annual Population Rank MSA Family Permits Change Estimate 1 New York Newark Jersey City, NY NJ PA 38,503 8,518 20,257,610 2 Dallas Fort Worth Arlington, TX 26,923 3,729 7,125,239 3 Los Angeles Long Beach Anaheim, CA 20,911 2,386 13,432,332 4 Seattle Tacoma Bellevue, WA 16, ,737,408 5 Miami Fort Lauderdale West Palm Beach, FL 12, ,032,325 6 San Francisco Oakland Hayward, CA 12,108 2,004 4,673,188 7 Chicago Naperville Elgin, IL IN WI 12,083 1,374 9,581,253 8 Denver Aurora Lakewood, CO 11, ,830,748 9 Washington Arlington Alexandria, DC VA MD WV 10, ,145, Austin Round Rock, TX 10,607 2,111 2,006, Portland Vancouver Hillsboro, OR WA 10,437 3,332 2,387, Boston Cambridge Newton, MA NH 9,911 3,639 4,790, Phoenix Mesa Scottsdale, AZ 8, ,606, Atlanta Sandy Springs Roswell, GA 7,786 4,940 5,736, Charlotte Concord Gastonia, NC SC 7,539 1,322 2,436, Nashville Davidson Murfreesboro Franklin, TN 7, ,840, San Diego Carlsbad, CA 6,406 1,368 3,311, Minneapolis St. Paul Bloomington, MN WI 6, ,547, Philadelphia Camden Wilmington, PA NJ DE MD 6,232 1,083 6,077, Houston The Woodlands Sugar Land, TX 5,865 4,054 6,677, Apartment Supply Hit 30-Year High in 2017 New Units Delivered (in 2017) 2017 is expected to be the peak for apartment deliveries as the market works on absorbing these new units. Nationally rent growth slowed to 2.6%. That s down from roughly 4% to 5% increases from 2014 through Healthy economy helps with absorption axiometrics 14 7

8 Rent Growth beginning to cool down 15 More Apartments expected to be delivered Source: ALN 16 8

Atlanta Resale Market Single Family, Townhouse and Condo Strong fundamentals and favorable market demographics Keep the Atlanta housing market healthy 17 ATLANTA RESALE MARKET TRENDS - CLOSINGS AND

9 Atlanta Resale Market Single Family, Townhouse and Condo Strong fundamentals and favorable market demographics Keep the Atlanta housing market healthy 17 ATLANTA RESALE MARKET TRENDS - CLOSINGS AND INVENTORY INCLUDES DETACHED, ATTACHED AND CONDOS Source: FMLS Units per Year 80,000 75,000 70,000 65,000 60,000 55,000 50,000 45,000 40,000 35,000 30,000 25,000 20,000 15,000 10,000 5,000 0 Year over Year Closings up 3% Inventory down 20% 76,602 closings Annual Closings Total Inventory 18% TH/Condo Closings 11% TH/Condo Inventory 18 9

ATLANTA RESALE MONTHS OF SUPPLY INCLUDES DETACHED, ATTACHED AND CONDOS Source: FMLS Months of Supply of Resale Inventory Includes single family detached, townhome and condo 14.0 12.0 10.

10 ATLANTA RESALE MONTHS OF SUPPLY INCLUDES DETACHED, ATTACHED AND CONDOS Source: FMLS Months of Supply of Resale Inventory Includes single family detached, townhome and condo Months of Supply to 7 months was about normal Month Supply New record low Months of Supply of Resale Inventory 19 MLS Months Supply of total inventory 12/31/

11 NOT ENOUGH INVENTORY MEANS MUCH MORE REMODELING ACTIVITY Low Supply Cause and Effect on the region Not enough home building Investor Buyers suppressing availability Owners can t find a suitable replacement home Affordable 22 11

Resale Single Family Detached Listings v. Annual Sales By Price Range Dec 2017 Annual Sales Listings Months of Supply MOS 12,000 10,500 9,000 Inventory and months supply fell in all price ranges 13.

12 Resale Single Family Detached Listings v. Annual Sales By Price Range Dec 2017 Annual Sales Listings Months of Supply MOS 12,000 10,500 9,000 Inventory and months supply fell in all price ranges ,500 6, ,500 3,000 1, < $100 $100- $150 $150- $200 $200- $250 $250- $300 $300- $350 $350- $400 $400- $500 $500- $600 $600- $800 $800- $1million+ $1million Atlanta Resale Price Trends All Counties Detached only Median Closing Prices with REO Transactions Median size = 1,916 SF or $97 PSF (up 4%YoY) 4Q16 4Q17* %diff $183,000 $187, % 15% REO 8% REO $193,600 without REO $190,000 without REO Average price was $252,700 * All closings within a 3 month moving average Source: Metrosearch 24 12

13 Larger Homes Resale Price Trends 2,000+ Square Feet Houses Median Closing Prices with REO Transactions Average size = 2,700 SF or $99 PSF (up 4.1% YoY) 4Q16 4Q17* %diff $265,000 $275,000 +4% 10% REO 5% REO $275,000 without REO $285,000 without REO 42% of all closings were > 2000sf Source: Metrosearch 25 Atlanta Median Resale and REO Price Trends (detached only) $190,000 $184,200 $185,600 $177,900 $174,500 $187,000 $170,000 $150,000 $158,300 $169,300 $176,900 $164,900 $148,800 $161,900 $183,400 $183,000 $130,000 $125,100 $128,100 $110,000 $90,000 $70,000 $122,500 $113,400 $94,800 $101,300 $88,500 $77,500 $86,200 $88,600 $97,600 $95,400 $115,500 $50,000 Q Q Q Q Q Q Q Q Q Q Q Q Q Resale REO Source: Metrostudy Analytics / 2/2/

14 Atlanta Median Price % Change YoY (detached only) 10% 7% 9% 9% 8% 5% 1% 5% 2% 0% 1% 0% 5% 5% 7% 10% 15% Resale % Change 10% / 2/2/ Source: Metrostudy Analytics 14

ATLANTA HOUSING MARKET We conduct field research on 22 Counties each quarter Strong fundamentals and favorable market demographics Keep the housing market healthy Atlanta Housing Market Single Family

15 ATLANTA HOUSING MARKET We conduct field research on 22 Counties each quarter Strong fundamentals and favorable market demographics Keep the housing market healthy Atlanta Housing Market Single Family and Townhome Combined 22 counties combined 4Q17 29 NORTH ATLANTA SINGLE FAMILY MARKET QUARTERLY STARTS AND CLOSINGS 4,800 4,400 4,000 3,600 3,200 4, % 4, % 2,800 2,400 2,000 4Q17 3Q17 2Q17 1Q17 4Q16 3Q16 2Q16 1Q16 4Q15 3Q15 2Q15 1Q15 4Q14 3Q14 2Q14 1Q14 4Q13 QtrStarts QtrClosings 30 15

2,000 SOUTH ATLANTA SINGLE FAMILY MARKET

1,600 1,711 + 17% 1,400 1,200 1,000 800 4Q17

2Q15 1Q15 4Q14 Qtr Starts Qtr Closings 31

16 2,000 SOUTH ATLANTA SINGLE FAMILY MARKET QUARTERLY STARTS AND CLOSINGS 1, % 1,800 1,600 1, % 1,400 1,200 1, Q17 3Q17 2Q17 1Q17 4Q16 3Q16 2Q16 1Q16 4Q15 3Q15 2Q15 1Q15 4Q14 Qtr Starts Qtr Closings 31 NATIONAL HOUSING MARKET Annual Starts and Closings by Market 32 16

17 Sales Per Model Home 2,200 2,000 Models Sales Per Model , , Model Homes 1,400 1,200 1,000 Up 7% from Sales Per Model Q07 4Q08 4Q09 4Q10 4Q11 4Q12 4Q13 4Q14 4Q15 4Q16 4Q17 33 Finished Inventory and Months Supply 22,000 20,000 Finished Vacant FinVac MOS FinVac Homes 18,000 16,000 14,000 12,000 10,000 8, MOS for Finished Inventory 4Q17 Single Family MOS = 2.5 Townhouse MOS = 3.7 Up 12% YoY Months of Supply 6, , ,934 2, Q07 4Q08 4Q09 4Q10 4Q11 4Q12 4Q13 4Q14 4Q15 4Q16 4Q

Atlanta Median New and Resale Price Trends (detached only) $300,000 $280,000 $275,100 $285,400 $289,700 $289,000 $260,000 $253,700 $264,700 $240,000 $220,000 $210,900 $232,700 $230,400 $229,700

18 Atlanta Median New and Resale Price Trends (detached only) $300,000 $280,000 $275,100 $285,400 $289,700 $289,000 $260,000 $253,700 $264,700 $240,000 $220,000 $210,900 $232,700 $230,400 $229,700 $207,100 $234,500 $240,400 $102,00 Or 55% Difference $200,000 $180,000 $160,000 $140,000 $158,300 $169,300 $184,200 $185,600 $176,900 $177,900 $164,900 $148,800 $161,900 $174,500 $187,000 $183,400 $183,000 Q Q Q Q Q Q Q Q Q Q Q Q Q Resale New Sale / 2/2/ / 7/2/

63% of all loans had a mortgage (37% paid all cash) 25% of all loans were FHA loan types 12/31/17 The following reports

19 ATLANTA S FINISHED LOTS 55% are in North Atlanta 88,302 74,974 detached (85%) 13,328 Townhome 37 Atlanta Mortgage Lenders Lenders: LMI (Low to Moderate Income) data now available in Metrosearch! 63% of all loans had a mortgage (37% paid all cash) 25% of all loans were FHA loan types 12/31/17 The following reports (and many others) can currently be run in the Metrosearch Property Analysis System. Go to reports, Lender Analysis, Lender and Loan Summary, sort by number of loans 38 19

Top Mortgage Lenders as of 4Q17 Atlanta MSA (annual) AVERAGE LOAN AMOUNT = $233,900 39 Atlanta Region: 4Q17 Top Ten Builders Market Share of Annual Closings 2009 market share was 22% 2010 market

1% Smith Douglas Century 3.5% Communities 5.8% 906 774 Taylor Morrison 1,247 2.

20 Top Mortgage Lenders as of 4Q17 Atlanta MSA (annual) AVERAGE LOAN AMOUNT = $233, Atlanta Region: 4Q17 Top Ten Builders Market Share of Annual Closings 2009 market share was 22% 2010 market share was 28% 2011 market share was 35% 2012 market share was 39% 2013 market share was 39% 2014 market share was 41% 2015 market share was 42% 2016 market share was 46% Pulte/Wieland 4.1% Smith Douglas Century 3.5% Communities 5.8% Taylor Morrison 1, % 650 All Other Builders 57% Top Ten Builders 43% Top 25 Builders market share was 58% All Production Builders market share was 73% DR Horton/old Crown/WP 15.8% 3,501 Rocklyn Homes 2.4% 534 CalAtlantic/Ryland 2.2% 485 Ashton Woods/Starlight 2.1% Lennar Homes 2.0% Providence Group % Total Annual Closings as of 4Q 2017 = 22,182 Metrostudy, a Hanley Wood Company March 1,

1Q 2014 Greater Atlanta HBA Builder Developer Lender Council meeting Information presented by. Atlanta Job Growth

1Q 2014 Greater Atlanta HBA Builder Developer Lender Council meeting 5-21-2014 Information presented by Eugene James, Regional Director ejames@metrostudy.com 404-510-1080 connect on LinkedIn Atlanta Job