ALBUQUERQUE HOUSING FORECAST

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Welcome to the Fall 2007 Crystal Ball Seminar!
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THE NEW AMERICAN HOME

• PRODUCT OBSOLESCENCE

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PRODUCT LIFE CYCLE
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STOP THINKING
1979 ... 1980
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Underserved Markets

• We are Still Building As If Every Buyer is a
  Nuclear Family

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But The Truth Is

• The Average Home
  Square Footage is
  UP 46

• The Average Household Size is
  Down 23

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HOME OFFICE

• AT LEAST 1/3 OF YOUR BUYERS WORK FULL TIME FROM
  HOME

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US CENSUS DATA
TYPICAL AMERICAN FAMILY

• 86 million people in this country are single
• 51 of all adult women in this country are single.

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UP NEXT . . . David Murphy
SalesTraq of New Mexico
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Sub Prime Fallout!!!!
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But what is the big picture telling us?
Over the next 4 month stretch, the average base
price decreased - 3.3
Over this 20 month stretch, the average base
price rose only 1.1
Over the following 3 month stretch, the average
base price rose 14.2!!!
Up 69
Since Jan. 2001
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Observation Our local bubble is leaking air.
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Average Median percentage increase for
Albuquerque (Year over year comparison) NEW
HOME BROCHURE BASE ASKING PRICE (Single Family
Homes)
November 2006 average 256,174 November 2007
average 253,847
0.9 decrease
Thats the first year over year average price
decrease since February of 2004
Source SalesTraq of New Mexico -
www.salestraq.com/albuquerque
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Price Prediction
In the months ahead, base prices of new homes
will continue to decline. This will be
accomplished primarily by downgrading the
standard features.
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Certainty
The new homes of the future will continue to be
designed and driven largely by the need for
energy efficiency
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Residential Housing Update in the Albuquerque
Area

• Jim Folkman
• Executive Vice President
• Home Builders Association of Central New Mexico
• November 8, 2007

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Single Family Permit History
Blah bah Blah Blah
Blah
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Down-Turn Significance

• Profound and direct effect on home construction
  industry and economy of New Mexico.
• 1.3 billion industry in ABQ Metro.
• 65.9 million in GRT Revenues
• Reminds us that our industry is, inevitably and
  historically, cyclical in nature

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Magnitude of Foreclosure Problem

• Currently 732,000 foreclosures in process
• Another 410,000 soon to be in process
• 46 of all mortgages placed in recent years
  had less than 5 DP

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Magnitude of Foreclosure Problem

• One third during same time were sub-prime
• Adjustable rates could go from, say, 7.5 to
  11 at adjustment point
• Foreclosure rate in NM is currently ranked
  44th, but that will probably change

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Where Will Homes and Communities Be Built in the
Future?

• Fewer and fewer stand-alone subdivisions
• More and more master-planned and mixed- use
  communities
• Fewer than 14,000 lots left in COA, which is a
  4-5 year supply
• Over 170,000 in planning by master- planned
  communities
• Increasing opportunities in redevelopment

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SALESTRAQTM Of New Mexico More information at
www.Salestraq.com and www.CrystalBallSeminars.com