Regional Housing Market Perspective

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Regional Housing Market Perspective

• HANLEY WOOD MARKET INTELLIGENCE
• Formerly Meyers Group
• Stephen Smiley [phone] x224
  ssmiley_at_hanleywood.com

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WHO IS HANLEY WOOD MARKET INTELLIGENCE?

• Information Nations leading provider of
  residential real estate information
• Covering 30 major metropolitan areas nationwide
• Addressing active subdivisions and the
  entitlement pipeline
• Consulting Customized analysis for residential
  and master planned communities
• 848 studies in 22 states in 2004
• Pricing strategies, absorption studies, product
  analysis and strategic planning

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EXPANSION MOTIVATIONS

• Increase Revenue
• Expand Scale to Enhance Valuation
• Geographic Diversification to Lower Risk
• Product Expansion and Land Inventories
• The Closer In Markets Are Taken

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San Joaquin Map
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Stanislaus Map
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Merced Map
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Fresno Map
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NEW HOME AFFORDABILITY RATIO Major California
Markets
1st Quarter 2005 Statistics Orange
County 3.8 San Diego 6.4 LA/Ventura 14.3
Inland Empire 15.3 Bay Area 14.5 Sacramento 16.
7 Central California 16.9
Note Data is for 30-Year Fixed Rate Mortgage and
2005 figures are based on 1Q05 data. Source
Meyers Market Monitor, Hanley Wood Market
Intelligence
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DETACHED MEDIAN PRICECentral Valley
408k (44)221 increase from 1st Qtr 1995
Note 2005 figures are based on 1Q05
data Source Meyers Market Monitor, Hanley Wood
Market Intelligence
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NEW DET. HOME TRENDS IN PRICE VALUE/SF Central
Valley
Median Price407,859 (44) Price/SF182 (5.2)

• Merced 181k (10.3)
• San Joaquin 200k (7)
• Stanislaus 171k (5.6)

Note 2005 figures are based on 1Q05
data Source Meyers Market Monitor, Hanley Wood
Market Intelligence
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AVERAGE DETACHED NEW HOME PRICESCommuter
Corridor/Hwy 5 99January 2005

• Tri-Valley
• Dublin 1,084, 975
• Livermore 1,207,301
• San Ramon 916,837
• Central California
• Tracy 581,622
• Patterson 490,159
• Lathrop 461,191
• Los Banos 401,046
• Manteca 394,134
• Stockton 388,076
• Modesto 354,209
• Fresno 309,518
• Merced 288,604

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SAN JOAQUIN MOST ACTIVE SUBMARKET Central Valley
San Joaquin Captures 47 of Sales
San Joaquin 53.1 in 1997
Source Meyers Market Monitor, Hanley Wood Market
Intelligence.
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NEW HOME EXECUTIVE SUMMARY REPORT 1st QUARTER 2005
Median Detached Base
Total Sales (Detached Attached)
Counties
Source New Home Executive Summary Report, Hanley
Wood Market Intelligence.
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Current Median Price and New Home Sales over
Past Four Quarters

• San Joaquin 464,990 4,804 sales
• Stanislaus 407,656 3,997 sales
• Merced 336,190 2,164 sales
• Fresno region 307,500 5,625 sales
• Kern County 295,750 2,320 sales

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DET. SALES MAJORITY NOW OVER 350KCentral Valley
YTD Net Sales 2004 4 Over 500K
7 Over 450K
13 Over 400K 18
Over 350K 25 Over 300K
17 Over 250K 8 Over
200K 2 Over
150K.001 Over 100K .001
under 100K
Source Meyers Market Monitor, Hanley Wood
Market Intelligence
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INVENTORY REMAINS LOWCentral Valley
1Q05 Stdg. Inv. 101Q05 Speculative Inv. 13Mo.
Spec. Inv. 0.0
Source Meyers Market Monitor, Hanley Wood Market
Intelligence
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Central ValleyFuture Supply

• County Active Mapped Total
• San Joaquin 3,357 19,242 22,599
• Stanislaus 3,808 7,583 11,391
• Merced 2,993 8,435 11,428
• Projected Supply (Based on 2004 Sales)
• San Joaquin 4.17 years (5,414 sales/yr)
• Stanislaus 2.81 years (4,084 sales/yr)
• Merced 5.43 years (2,103 sales/yr)

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RESALES HIT NEW RECORD IN 2004Central CA
2004 - 56,026 Sales
Source Meyers Market Monitor, Hanley Wood Market
Intelligence
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2004 TOP BUILDERSCENTRAL VALLEY
Source Hanley Wood Market Intelligence
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1Q05 TOP BUILDERSCENTRAL VALLEY
Source Hanley Wood Market Intelligence
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2004 TOP BUILDERSFRESNO MSA
Source Hanley Wood Market Intelligence
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1Q05 TOP BUILDERSFRESNO MSA
Source Hanley Wood Market Intelligence
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News and Notes from Central Valley

• In the entire Central California region, builders
  had detached net sales of 18,508 homes through
  2004, representing an increase of 3.5 over 2003.
• The detached average prices in Central California
  rose 32 from 2003 to 369,845. The highest
  increases were found in Central Valley were new
  homes commanded an average price of 409,488. By
  comparison, the Kern County submarket base prices
  increased to 298,452, followed by the Fresno
  market which increased to 305,661.
• Central Valley with 163 projects had 93 of its
  sales occurring in homes priced at over 300,000.
  

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GOING FORWARD

• Look for additional product in Mountain House,
  Lathrop, etc. Growth control in Tracy, etc.
• Merced/Madera will continue to expand.
• Lot prices continue to increase has more builders
  look towards the area to expand.
• The Bay Area will always impact the market,
  however, local valley move-up buyers now a major
  market. Due to increased equity and low interest
  rates.
• Price points increasing. Tracy/Lathrop towards
  the high 500,000s, other areas into the mid
  400,000s.
• Look for more slow growth measures to come to a
  vote over the next few years
• Markets expanding south of Fresno, communities
  such as Selma, Sanger, Reedley, etc
• Bay Area/Sacramento builders need to keep
  pipeline filled.

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WHERE CAN WE FIND CHEAP LAND?