SALES RANGE-BOUND AT A SUBDUED LEVEL

Existing Home Sales Thursday, October 20, 2011

Record High: 7.25 M (09/05) Percent Change from Record High: -32.3% Existing home sales slumped 3.0% in September to an annual rate of 4.91 million which was roughly in line with market expectations. Existing home sales are now 11.3% above their year ago level but remain 32.3% below their September 2005 peak. All cash sales accounted for 30% of transactions; distressed sales comprised 30% of the total, first-time buyers accounted 32% of sales while investors made up 19% of total transactions. Regionally, sales declined in three areas with an 8.8% drop in the West, 2.6% decline in the South and a 0.9% slip in the Midwest. Sales gained 2.6% in the Northeast. The inventory of homes available for sale fell 2.0% last month to 3.480 million which represents an 8.5 month-supply at the current sales pace. Foreclosures are rising again as the banks unwind the backlogs related to robo-signings; inventories could increase and prices may weaken further. Home prices declined again in September with the median price for an existing home down 3.5% over the past year to $165,400 while average prices dropped 2.5% to $212,700. Existing home sales are weak but remain within the range seen in the last couple of years. The housing market recovery continues to be thwarted by a weak economy and stagnant labor market conditions. Contract failures continue to weigh on overall sales. Economists expect home resales to bump along the bottom the remainder of the year with a price and sales recovery beginning sometime in 2012.
MILLIONS OF UNITS Forecast: Consensus*: Actual: 4.95 M 4.90 M 4.91 M Monthly Changes Sep-11 4.91 -3.0 11.3 790 2.6 1,090 -0.9 1,890 -2.6 1,140 -8.8 3,480 -2.0 -13.0 8.5 165.4 -3.5 212.7 -2.5 Aug-11 5.06 8.4 19.3 770 2.7 1,100 4.8 1,940 5.4 1,250 20.2 3,551 -3.7 -13.7 8.4 171.2 -3.4 219.5 -2.8 Jul-11 4.67 -3.5 21.0 750 2.7 1,050 1.0 1,840 -1.6 1,040 -12.6 3,686 -0.8 -8.0 9.5 171.2 -6.0 220.4 -4.9 Jun-11 4.84 0.6 -7.5 730 -5.2 1,040 1.0 1,870 1.1 1,190 2.6 3,717 1.9 -4.4 9.2 175.6 -4.0 226.0 -1.7 Three Month 4.88 Six Month 4.88 Average Changes for Twelve Month 2010 2009 4.91 4.92 -4.5 770 1,080 1,890 1,143 767 1,067 1,890 1,158 782 1,057 1,885 1,188 863 1.8 1,168 3.5 1,907 2.7 1,214 14.4 3,560 8.4 8.7 172.4 -0.2 219.5 1.2 5.15 5.2 848 -16.0 1,128 -15.2 1,857 -17.3 1,062 -2.8 3,283 -11.3 7.7 172.7 -12.4 216.8 -10.2 996 1,342 2,258 1,268 988 1,356 2,200 1,295 Five Year 5.43 Ten Year 5.81

Existing Home Sales (millions) (percent change) (year-on-year percent change) Northeast (thousands) (percent change) Midwest (thousands) (percent change) South (thousands) (percent change) West (thousands) (percent change) Inventory (thousands) (percent change) (year-on-year percent change) Months' Supply Median Sales Price ($000) (year-on-year percent change) Average Sales Price ($000) (year-on-year percent change)

3,572

3,640

3,614

3,593

2,935

8.8 169.3

9.0 169.0

8.9 166.4

8.0 196.2

6.2 188.5

217.5

217.7

214.7

242.0

232.8

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 we believe to be reliable, but accuracy is not guaranteed.