credit suisse survey of real estate agents jan. 2014 results

8/13/2019 Credit Suisse Survey of Real Estate Agents Jan. 2014 Results

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CREDIT SUISSE SECURITIES USA) LLC

DISCLOSURE APPENDIX CONTAINS IMPORTANT DISCLOSURES, ANALYST CERTIFICATIONS, INFORMATION ON TRADE ALERTS, ANALYST MODEL PORTFOLIOS ANDTHE STATUS OF NON-U.S ANALYSTS. FOR OTHER IMPORTANT DISCLOSURES, visit www.credit-suisse.com/ researchdisclosures or call +1 (877) 291-2683. U.S. Disclosure:Credit Suisse does and seeks to do business with companies covered in its research reports. As a result, investors should be aware that the Firm may have a conflict of interest thatcould affect the objectivity of this report. Investors should consider this report as only a single factor in making their investment decision.

Febru ary 10, 2014

Daniel Oppenheim, CFAHomebuilding & Building [email protected]

Michael Dahl212-325-5882

[email protected]

William [email protected]

Patrick Murray, [email protected]

Monthly Survey of Real Estate Agents January 2014

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50 - Exceeds Expectations

Traffic improved marginally in January, but levels still missed expectations. The pace of improvementis also below historical levels, and our index reading of 38 is well below our reading of 59 in January2013. We believe this sets up for a potentially underwhelming 2014 spring selling season.

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50 - Higher than Prior Month

Home price appreciation improved in January, but low demand may keep a lidon the pace of improvement during the spring season.

Source: Credit Suisse


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January 14 Slide 3

Table o f Contents

Key Housing Markets: Key Housing Markets Contin ued: 4 Atlanta, Georgia 26 Orlando, Florida 5 Austin, Texas 27 Philadelphia-Southern New Jersey 6 Baltimore, Maryland 28 Phoenix, Arizona

7 Boston, Massachusetts 29 Portland, Oregon 8 Charleston, South Carolina 30 Raleigh, North Carolina 9 Charlotte, North Carolina 31 Richmond, Virginia

10 Chicago, Illinois 32 Sacramento, California 11 Cincinnati, Ohio 33 San Antonio, Texas 12 Columbus, Ohio 34 San Diego, California 13 Dallas, Texas 35 San Francisco, California 14 Denver, Colorado 36 Sarasota, Florida 15 Detroit, Michigan 37 Seattle, Washington 16 Fort Myers, Florida 38 St. Louis, Missouri 17 Houston, Texas 39 Tampa, Florida 18 Inland Empire (Riverside-San Bernardino), California 40 Tucson, Arizona 19 Jacksonville, Florida 41 Virginia Beach, Virginia 20 Las Vegas, Nevada 42 Washington, D.C.21 Los Angeles, California 43 Wilmington, North Carolina 22 Miami, Florida Appendix: 23 Minneapolis, Minnesota 45 Historical Trends by Market 24 Nashville, Tennessee 50 Agent Recommendations 25 New York-Northern New Jersey 52 Survey Methodology


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January 14 Slide 4

Atlanta, GA Traffic Being Held Up by Low Inventories, but Pricing Tailwinds In-Place

Source: Credit Suisse; Census Bureau

(9,146 single-family building permits in 2012, 5th largest market in the country)

Comments from Real Estate Agents: Lack of inventory. Up and downs of economy, politics, and international

economy and conflicts. Foot traffic is typical of the time of year. What is different is

that current buyers are ready to buy" immediately for theright house. Inventory levels are way below the norm, thuscausing pricing to hold steady.

I am getting many more internet leads. There is pent -updemand. Seeing more second home buyers, which is asignificant part of my market in North Georgia.

Our Take: Buyer traffic was just below agents expectations in January, as

our traffic index was flat vs. December at 45 (50 is neutral).Agents continue to cite low inventories weighing on traffic

levels and the supply picture did not improve in the month asour Home Listing Index continues to indicate inventorycontraction.

Home prices rose in January with more broad-based gains, asour Home Price Index was 66 vs. 60 in December.

Inventories continued to fall as time to sell began shortening inthe last two months, a positive for future pricing.

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Month

Buyer Traffic

Index

Home Price

Index

Incentive

Index

Home Listings

Index

Time to Sell

Index Aug-13 35.7 78.6 42.9 64.3 46.4Sep-13 17.4 61.9 52.5 80.4 43.5Oct-13 12.5 63.6 36.4 63.6 27.3Nov-13 41.7 54.2 29.2 66.7 29.2Dec-13 45.0 60.0 25.0 70.0 55.0 Jan-14 45.0 65.8 36.1 65.8 68.4

Point Change 0.0 5.8 11.1 (4.2) 13.4

20%

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Traffic Levels Versus Expectations

More than expected Meets expectations Less than expected

42%28%

11%

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72%

42%

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Home Prices Incentives Time to Sell

How Do the Recent 30 Days Compare tothe Prior 30 Days...

Increased Remained the same Decreased


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January 14 Slide 5

Austin, TX Buyers Coming Back Out Despite Lack of Inventory; Expect Higher Prices


(7,970 single-family permits in 2012, 7th largest market in the country)

Comments from Real Estate Agents: Increased confidence in the market. Rents going up.

Rates starting to go up, pushing buyers into the marketbefore prices go up too much further.

Our usual "sleeper" January blew through the roof with

business. One of our busiest months in the last 2 years. Low inventories and low quality homes. Plenty of buyers, not as many homes, inventory is low. At this time there is just almost no inventory in areas with a

400- 800 price range until you hit the outer fringe of town.

Our Take: Our Buyer Traffic Index moved sharply higher in January with a

reading of 59 vs. 35 in December. Agents note that despite thegeneral lack of quality inventory in the market, buyers are

coming out to look. Local economic activity, confidence, andpeople moving to the area continue to be the main drivers. Price gains were broad-based in January as our price index

increased to 84 from a still-strong 75 in December. We expect pricing will improve further, as both inventories and

time to sell fell further in January, which are positive indicatorsfor future pricing particularly with improving traffic.

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Point Change 24.4 9.4 16.3 14.4 18.1

44%

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69%

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January 14 Slide 6

Baltimore, MD Buyer Traffic Better, but Still See Limited Home Price Appreciation



Comments from Real Estate Agents: There seems to be a lot of tire -kicking, and people

preparing for a full on home search when the weatherwarms. Lots of calls, lots of appointments.

Bad weather and uncertainty in where the market is going.

Our Take: Buyer traffic was in-line with expectations with our index

posting a neutral 50 in January from 30 in December. Agentsnoted that buyers are still cautious with the primary cause

being uncertainty on what direction prices are going, althoughthere is some optimism for a potential pick-up. Prices rose again in January with our price index coming in at

67 from 70 in December. Pricing power may slow in coming months as inventories were

unchanged in January after increasing in the prior two months,while the time to sell has lengthened over the same period.

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January 14 Slide 7

Boston, MA Buyer Traffic Remains Anemic without Listings to View



Comments from Real Estate Agents: The market has deteriorated significantly. In some Metrowest

towns inventory is off 70%. Many of the properties on themarket are spectacularly over-priced. Hopefully, inventorywill return in the spring.

Lack of inventory. Unattractive properties on market and interest rates. Although the economy is improving, buyers are still

cautious. People are coming in with better positive attitudes.

Our Take: Buyer traffic remained weak in January as our index fell to 24

from 26 in December. The vast majority of agents (even thosethat saw more traffic than expected) highlighted a lack of

inventory in the market pressuring traffic with the hope beingthat the spring season brings out more supply. Home prices rose again in January as our Home Price Index

came in at 70 from a still positive 57 in December. Inventories further contracted in January as our index came in

at 88 from 95 in December. While lower supply is a positive forprice, some listings are needed to keep the market functioning.

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Point Change (2.4) 12.9 5.0 (7.7) 2.9

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45%

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January 14 Slide 8

Charleston, SC Traffic Continues to Fall, but Prices Push Higher on Light Inventory Levels



Comments from Real Estate Agents: Very similar to January 2013. Less inventory available for

sale. Rates are still high. People think the bad market is over? Lending is getting more complicated.

Our Take: Our Buyer Traffic Index indicates traffic levels well below

agents expectations with the index reading 10 in January from30 in December. Agents noted that higher interest rates are

still impacting traffic levels, although well look for someabatement of that pressure in our February survey given therecent decline in mortgage rates.

Home prices were seen higher for the most part as our HomePrice Index came in at 60 in January from 70 in December.

Inventory levels remain tight as our listing index shows furthercontraction in January while the time to sell remained flat m/m.

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Point Change (20.0) (10.0) 0.0 0.0 (10.0)

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Home Pr ic es Inc ent ive s Ti me to Sel l




9/55

January 14 Slide 9

Charlotte, NC Buyer Traffic Picks Up on Higher Prices Later Mindset



Comments from Real Estate Agents: There is a lack of good inventory. Threat of interest rates rising. Low inventory. Good buying

opportunities. We continue to see a strong interest in buying new homes

before prices and interest rates go up more.

Our Take: Buyer traffic hit expectations for the first time since July 2013,

as our index came in at a neutral 50 from 43 in December.Agents continue to see limited inventory available, but some

buyers seem content with current levels on the expectation thatprices are only going to move higher in coming months. Prices rose in January with our price index coming in at 67,

although the gains were less broad-based than December. Inventories and time to sell fell further in January, which should

support prices in the future, particularly as buyer traffic levelshave begun to pick up.

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Point Change 7.1 (19.0) (25.4) (23.0) (19.0)

34%

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33%22%

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67% 78%

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10/55

January 14 Slide 10

Chicago, IL Yes, There was a Polar Vortex, but Weak Economic Confidence Not Helping Traffic



Comments from Real Estate Agents: Higher taxes, market uncertainty, people are nervous again

waiting for the other shoe to drop. New lending rules, cold weather, and the economy still is

not good in IL. Seeing lots of tenants and rising rents. First time buyers still

seem afraid to commit to condos due to the condition of theeconomy, and health care uncertainty and potential costs.

Buyers are concerned that prices and rates are going up sothat want to buy before that happens.

Our Take: Our Buyer Traffic Index slipped back to 30 in January from 43

in December and while many fingers pointed at the weather,other concerns included economic nervousness and lending

constraints. Those that did see better than expected trafficnoted that the main driver was an urgency to buy before pricesand interest rates moved any higher.

Home prices continued to rise in January, as our Home PriceIndex came in at 61 from 56 in December.

Inventories shrunk again in January, while the time to sell wasroughly unchanged relative to December.

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Point Change (13.2) 4.6 9.5 (21.5) (3.0)

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Home Pri ces I ncent ives Ti me to Sel l




11/55

January 14 Slide 11

Cincinnati, OH Buyer Traffic Slows, but Home Prices Hold Up with Limited Inventory



Comments from Real Estate Agents: Inventory is so low. We keep waiting for and expecting

more houses to hit the market but it is very slow in coming. Snow and cold has led to lack of showings and few

buyers.

Our Take: Buyer traffic fell sharply in January with our index coming in at

29 from a neutral 50 in December. In addition to poor weather,which was noted by most agents, low inventory levels had a

significantly negative impact on buyer traffic. Despite the lowinventory, we did not see comments discussing the buy beforeprices go up mentality here.

Prices rose again in January with our index coming in at 71from 57 in December.

Inventories continue to contract and time to sell decreased,which should help support price despite the slow traffic levels.

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J a n -

1 2

F e b -

1 2

M a r -

1 2

A p r -

1 2

M a y -

1 2

J u n -

1 2

J u l -

1 2

A u g -

1 2

S e p -

1 2

O c t -

1 2

N o v -

1 2

D e c -

1 2

J a n -

1 3

F e b -

1 3

M a r -

1 3

A p r -

1 3

M a y -

1 3

J u n -

1 3

J u l -

1 3

A u g -

1 3

S e p -

1 3

O c t -

1 3

N o v -

1 3

D e c -

1 3

J a n -

1 4

B u y e r

T r a

f f i c I n d e x


0102030405060708090

J a n - 1

2

F e b - 1

2

M a r -

1 2

A p r -

1 2

M a y - 1

2

J u n - 1

2

J u l - 1 2

A u g - 1

2

S e p - 1

2

O c t - 1 2

N o v - 1

2

D e c - 1

2

J a n - 1

3

F e b - 1

3

M a r -

1 3

A p r -

1 3

M a y - 1

3

J u n - 1

3

J u l - 1 3

A u g - 1

3

S e p - 1

3

O c t - 1 3

N o v - 1

3

D e c - 1

3

J a n - 1

4

H o m e

P r i c e

I n d e x


Month

Buyer Traffic

Index

Home Price

Index

Incentive

Index

Home Listings

Index

Time to Sell


Point Change (21.4) 14.3 0.0 (7.1) 28.6

14%

29%57%



43%29%

14%

57%

71%

57%

0% 0%

29%

0%

20%

40%

60%

80%





12/55

January 14 Slide 12

Columbus, OH Buyer Traffic Remains Slow, Inventories are Low, and there was Definitely Snow



Comments from Real Estate Agents: Showings have stabilized but still low inventory. Fear of rate hikes, but inventory low. Part of it is a post -holiday bounce. Part is that people think

interest rates will go up, so it's motivating them to move

now. Low interest rates.

Our Take: Buyer traffic relative to expectations was roughly in-line with

levels seen in 4Q, as our index came in at 38 vs. 33 inDecember. Agents note that low inventory levels have

pressured buyer traffic levels, but providing a partial offset arebuyers expecting the still-low interest rates to rise. Prices bounced back after falling in December with our price

index rising to 69 in January from 42. Inventories fell again in January as the time to sell contracted,

which should support home prices, although the slow trafficlevels should limit appreciation.

0102030405060708090

100

J a n -

1 2

F e b -

1 2

M a r -

1 2

A p r -

1 2

M a y -

1 2

J u n -

1 2

J u l -

1 2

A u g -

1 2

S e p -

1 2

O c t -

1 2

N o v -

1 2

D e c -

1 2

J a n -

1 3

F e b -

1 3

M a r -

1 3

A p r -

1 3

M a y -

1 3

J u n -

1 3

J u l -

1 3

A u g -

1 3

S e p -

1 3

O c t -

1 3

N o v -

1 3

D e c -

1 3

J a n -

1 4

B u y e r

T r a

f f i c I n d e x


0102030405060708090

100

J a n - 1

2

F e b - 1

2

M a r - 1 2

A p r - 1 2

M a y - 1 2

J u n - 1

2

J u l - 1 2

A u g - 1

2

S e p - 1

2

O c t - 1 2

N o v - 1

2

D e c - 1

2

J a n - 1

3

F e b - 1

3

M a r - 1 3

A p r - 1 3

M a y - 1 3

J u n - 1

3

J u l - 1 3

A u g - 1

3

S e p - 1

3

O c t - 1 3

N o v - 1

3

D e c - 1

3

J a n - 1

4

H o m e

P r i c e

I n d e x


Month

Buyer Traffic

Index

Home Price

Index

Incentive

Index

Home Listings

Index

Time to Sell


Point Change 4.2 27.1 2.4 2.1 12.5

25%

25%

50%



38%29%

13%

63%

71%

50%

0% 0%

38%

0%

20%

40%

60%

80%





13/55

January 14 Slide 13

Dallas, TX Home Price Gains Back on Track with Better Traffic and Inventory Declines


(17,821 single-family permits in 2012, 2nd largest market in the country)

Comments from Real Estate Agents: Buyers that missed an opportunity in 2013 are attempting

to jump ahead of the spring 2014 rush. Job growth and corporate relocations. People are ready to buy partially because mortgage rates

and prices are trending upwards. Informed prospects perceive that inventory is low and there

may be competition to purchase. They are not as eager asthey were 6 months ago.

Low inventory.

Our Take: Traffic came back to a neutral level in January with our Buyer

Traffic Index registering a 54 reading from 31 in December.Multiple agents noted that buyers were eager to buy ahead

what are expected price and interest rate increases in comingmonths, but also that inventory issues are persisting. Price increases were broad-based in January with our index

jumping to 88 from a neutral 50 in December. Inventories declined again in January as the time to sell

contracted for the first time since September the combinationof the two with better traffic points to home price gains.

0102030405060708090

100

J a n -

1 2

F e b -

1 2

M a r -

1 2

A p r -

1 2

M a y -

1 2

J u n -

1 2

J u l -

1 2

A u g -

1 2

S e p -

1 2

O c t -

1 2

N o v -

1 2

D e c -

1 2

J a n -

1 3

F e b -

1 3

M a r -

1 3

A p r -

1 3

M a y -

1 3

J u n -

1 3

J u l -

1 3

A u g -

1 3

S e p -

1 3

O c t -

1 3

N o v -

1 3

D e c -

1 3

J a n -

1 4

B u y e r

T r a

f f i c I n d e x


0102030405060708090

100

J a n - 1

2

F e b - 1

2

M a r -

1 2

A p r -

1 2

M a y - 1

2

J u n - 1

2

J u l - 1 2

A u g - 1

2

S e p - 1

2

O c t - 1 2

N o v - 1

2

D e c - 1

2

J a n - 1

3

F e b - 1

3

M a r -

1 3

A p r -

1 3

M a y - 1

3

J u n - 1

3

J u l - 1 3

A u g - 1

3

S e p - 1

3

O c t - 1 3

N o v - 1

3

D e c - 1

3

J a n - 1

4

H o m e

P r i c e

I n d e x


Month

Buyer Traffic

Index

Home Price

Index

Incentive

Index

Home Listings

Index

Time to Sell


Point Change 22.9 37.5 21.4 (25.0) 21.6

25%

58%

17%



75%

18%27%25%

64%

27%

0%

18%

45%

0%

20%

40%

60%

80%





14/55

January 14 Slide 14

Denver, CO Further Home Price Appreciation Will Require More Buyer Traffic



Comments from Real Estate Agents: Rising interest rates, uneasiness about the economy. Low inventory of resale homes and no inventory of new

build homes. Publicity about lending standards tightening up and lack of

inventory to choose from. Two things: 1) People are starting to take notice of interest

rate movement and are trying to time the market before ratesgo up for good; 2) Low inventory is creating a slight panicamong buyers to buy before inventory levels get worse.

Our Take: Our Buyer Traffic Index moved closer to a neutral reading with

January coming in at 44 from 36 in December. Agents herenoted limited inventory levels and economic uncertainty offset

by an expectation of higher interest rates in the future andsome urgency to move ahead of the crowd in the spring. Prices moved higher in January as our Home Price Index came

in at 63 from 52 in December. Inventories contracted for the third straight month, but time to

sell has been lengthening since July 2013. Combined with lighttraffic, this may lead to a reversal of the recent pricing power.

0102030405060708090

100

J a n -

1 2

F e b - 1

2

M a r - 1

2

A p r - 1

2

M a y -

1 2

J u n -

1 2

J u l - 1

2

A u g -

1 2

S e p -

1 2

O c t - 1

2

N o v - 1

2

D e c - 1

2

J a n -

1 3

F e b - 1

3

M a r - 1

3

A p r - 1

3

M a y -

1 3

J u n -

1 3

J u l - 1

3

A u g -

1 3

S e p -

1 3

O c t - 1

3

N o v - 1

3

D e c - 1

3

J a n - 1

4

B u y e r

T r a

f f i c I n d e x


0102030405060708090

100

J a n - 1

2

F e b - 1

2

M a r -

1 2

A p r -

1 2

M a y - 1

2

J u n - 1

2

J u l - 1 2

A u g - 1

2

S e p - 1

2

O c t - 1 2

N o v - 1

2

D e c - 1

2

J a n - 1

3

F e b - 1

3

M a r -

1 3

A p r -

1 3

M a y - 1

3

J u n - 1

3

J u l - 1 3

A u g - 1

3

S e p - 1

3

O c t - 1 3

N o v - 1

3

D e c - 1

3

J a n - 1

4

H o m e

P r i c e

I n d e x


Month

Buyer Traffic

Index

Home Price

Index

Incentive

Index

Home Listings

Index

Time to Sell


Point Change 8.0 10.1 19.0 5.4 5.7

21%

46%

33%



29%18%

25%

67% 64% 63%

4%

18%13%

0%10%20%30%40%50%60%

70%

Home Pr ice s In cen ti ves Time to Sel l




15/55

January 14 Slide 15

Detroit, MI Buyer Traffic Falls Further as Home Price Gains Stall



Comments from Real Estate Agents: Government shutdown really slowed the market for new

buyers. Weather and, more importantly, new lending regulations. Higher rates, less inventory, more restrictions to get a

mortgage. Improved real estate market and pent -up demand. Panic over rising list prices and wanting to buy before it's

too late.

Our Take: Our Buyer Traffic Index continued to slide in January with the

index coming in at 18 (from 21 in December) as traffic did notexceed a single agents expectations. Causes for the lowtraffic were tightened lending rules, higher rates, and lingeringeffects of the government shutdown.

Home prices were roughly unchanged in January as our HomePrice Index came in at 53 from 61 December.

We continue to expect prices will come under pressure, as thetime to sell further increased (a negative for pricing), althoughinventories fell, which provide some offset.

0102030405060708090

100

J a n - 1

2

F e b - 1

2

M a r - 1

2

A p r - 1

2

M a y - 1

2

J u n - 1

2

J u l - 1

2

A u g - 1

2

S e p - 1

2

O c t - 1

2

N o v - 1

2

D e c - 1

2

J a n - 1

3

F e b - 1

3

M a r - 1

3

A p r - 1

3

M a y - 1

3

J u n - 1

3

J u l - 1

3

A u g - 1

3

S e p - 1

3

O c t - 1

3

N o v - 1

3

D e c - 1

3

J a n - 1

4

B u y e r

T r a

f f i c I n d e x


0102030405060708090

100

J a n - 1

2

F e b - 1

2

M a r -

1 2

A p r -

1 2

M a y - 1

2

J u n - 1

2

J u

l - 1 2

A u g - 1

2

S e p - 1

2

O c t - 1 2

N o v - 1

2

D e c - 1

2

J a n - 1

3

F e b - 1

3

M a r -

1 3

A p r -

1 3

M a y - 1

3

J u n - 1

3

J u

l - 1 3

A u g - 1

3

S e p - 1

3

O c t - 1 3

N o v - 1

3

D e c - 1

3

J a n - 1

4

H o m e

P r i c e

I n d e x


MonthBuyer Traffic

Index Home Price

Index Incentive

Index Home Listings

Index Time to Sell


Point Change (3.0) (8.1) (5.6) 3.4 12.6

0%

37%

63%



26% 22%

37%53%

67%

37%

21%11%

26%

0%10%20%30%40%50%60%

70%





16/55

January 14 Slide 16

Ft. Myers, FL Traffic Down Slightly, but Home Prices Keep Moving Higher



Comments from Real Estate Agents: Some sellers looking to upgrade cant afford to buy what

they want to so they are pulling off market. Steady traffic not too hot.

Our Take: Traffic wasnt too far below agents expectations as our index

came in at 43 from 50 in December. Agents noted thatseasonal trends were typical at this point, but there is somefrustration with higher prices as we havent seen a monthlyprice decline since October 2011.

Prices were broadly higher in January with our Home PriceIndex coming in at 79, up slightly from the December readingof 75.

Inventories decline in January as the time to sell shortened both factors should be supportive of prices in coming months.

0102030405060708090

100

J a n - 1

2

F e b - 1

2

M a r - 1

2

A p r - 1

2

M a y - 1

2

J u n - 1

2

J u l - 1

2

A u g - 1

2

S e p - 1

2

O c t - 1

2

N o v - 1

2

D e c - 1

2

J a n - 1

3

F e b - 1

3

M a r - 1

3

A p r - 1

3

M a y - 1

3

J u n - 1

3

J u l - 1

3

A u g - 1

3

S e p - 1

3

O c t - 1

3

N o v - 1

3

D e c - 1

3

J a n - 1

4

B u y e r

T r a

f f i c I n d e x


0102030405060708090

100

J a n - 1

2

F e b - 1

2

M a r - 1 2

A p r - 1 2

M a y - 1 2

J u n - 1

2

J u

l - 1 2

A u g - 1

2

S e p - 1

2

O c t - 1 2

N o v - 1

2

D e c - 1

2

J a n - 1

3

F e b - 1

3

M a r - 1 3

A p r - 1 3

M a y - 1 3

J u n - 1

3

J u

l - 1 3

A u g - 1

3

S e p - 1

3

O c t - 1 3

N o v - 1

3

D e c - 1

3

J a n - 1

4

H o m e

P r i c e

I n d e x


MonthBuyer Traffic

Index Home Price

Index Incentive

Index Home Listings

Index Time to Sell


Point Change (7.1) 3.6 33.3 21.7 16.7

0%

86%

14%



57%

33%

0%

43%

17%

67%

0%

50%

33%

0%10%20%30%40%50%60%

70%




ff h k l l h


17/55

January 14 Slide 17

Houston, TX Traffic Pushing Back to Neutral Levels as Prices Rise Further


(28,568 single-family permits in 2012, largest market in the country)

Comments from Real Estate Agents: Seller are frustrated with lack of inventory, increase in cost

of housing and new lending requirements that make it harderfor buyer to qualify.

Continuing relocation to Houston area.

There are slight signs of the market cooling off as inventorylevels in my downtown area have risen in the past fewmonths but still too early to call this a trend.

Inventory has dropped even further. Buyers are becomingweary and many are withdrawing until the market becomesmore stable.

Our Take: Buyer traffic continued to improve relative to expectations, but

still remains below a neutral 50 reading, as January came in at41 from 33 in December. Agents continue to see employmentgains in the area drive traffic, but competition among buyershas pushed some out of the market.

There were broad price gains in January as our index came inat 82 (from 85 in December) both well above a neutral 50.

We expect higher prices as time to sell contracted andinventories fell further across the area in January, however,some agents did note pockets of inventory growth.

0102030405060708090

100

J a n - 1

2

F e b - 1

2

M a r -

1 2

A p r -

1 2

M a y - 1

2

J u n - 1

2

J u l - 1 2

A u g - 1

2

S e p - 1

2

O c t - 1 2

N o v - 1

2

D e c - 1

2

J a n - 1

3

F e b - 1

3

M a r -

1 3

A p r -

1 3

M a y - 1

3

J u n - 1

3

J u l - 1 3

A u g - 1

3

S e p - 1

3

O c t - 1 3

N o v - 1

3

D e c - 1

3

J a n - 1

4

B u y e r

T r a

f f i c I n d e x


0102030405060708090

100

J a n - 1

2

F e b - 1

2

M a r -

1 2

A p r -

1 2

M a y - 1

2

J u n - 1

2

J u

l - 1 2

A u g - 1

2

S e p - 1

2

O c

t - 1 2

N o v - 1

2

D e c - 1

2

J a n - 1

3

F e b - 1

3

M a r -

1 3

A p r -

1 3

M a y - 1

3

J u n - 1

3

J u

l - 1 3

A u g - 1

3

S e p - 1

3

O c

t - 1 3

N o v - 1

3

D e c - 1

3

J a n - 1

4

H o m e

P r i c e

I n d e x


MonthBuyer Traffic

Index Home Price

Index Incentive

Index Home Listings

Index Time to Sell


Point Change 7.6 2.7 (5.6) (3.2) 27.3

0%

82%

18%



45%

22%9%

55%

67%

27%

0%11%

64%

0%10%20%30%40%50%60%

70%




I l d E i CA B T ffi Hi S d B H P i A i i Sl i


18/55

January 14 Slide 18

Inland Empire, CA Buyer Traffic Hits Speed Bump; Home Price Appreciation Slowing



Comments from Real Estate Agents: Lack of inventory and higher interest rates. More inventory and prices too high for the area. Prices are up, inventory is low and interest rates could be

going up. Economy is not improving much. Trying to get in a house before the prices go up, and/or

hoping there is less competition than in spring.

Our Take: Traffic fell below agents expectations in January with our index

coming in at 33 from 50 in December. Most agents notedlower inventories negatively impact buyer traffic (though somesaw more listings), while economic confidence and higherinterest rates also weighed on demand.

Home prices were slightly higher in January as our Home PriceIndex landed at 54 from 75 in December.

Future home price gains will be challenging as the time to sellcontinued to increase in January while inventories were onlymarginally lower.

0102030405060708090

100

J a n - 1

2

F e b - 1

2

M a r -

1 2

A p r -

1 2

M a y - 1

2

J u n - 1

2

J u l - 1 2

A u g - 1

2

S e p - 1

2

O c t - 1 2

N o v - 1

2

D e c - 1

2

J a n - 1

3

F e b - 1

3

M a r -

1 3

A p r -

1 3

M a y - 1

3

J u n - 1

3

J u l - 1 3

A u g - 1

3

S e p - 1

3

O c t - 1 3

N o v - 1

3

D e c - 1

3

J a n - 1

4

B u y e r

T r a

f f i c I n d e x


0102030405060708090

100

J a n - 1

2

F e b - 1

2

M a r -

1 2

A p r -

1 2

M a y - 1

2

J u n - 1

2

J u l - 1 2

A u g - 1

2

S e p - 1

2

O c t - 1 2

N o v - 1

2

D e c - 1

2

J a n - 1

3

F e b - 1

3

M a r -

1 3

A p r -

1 3

M a y - 1

3

J u n - 1

3

J u l - 1 3

A u g - 1

3

S e p - 1

3

O c t - 1 3

N o v - 1

3

D e c - 1

3

J a n - 1

4

H o m e

P r i c e

I n d e x


MonthBuyer Traffic

Index Home Price

Index Incentive

Index Home Listings

Index Time to Sell


Point Change (16.7) (20.8) (4.4) 4.2 1.7

25%

17%58%



25%30% 33%

58% 60%50%

17%10%

17%

0%10%20%30%40%50%60%

70%




J k ill FL H P i Ri B T ffi Ed Hi h d I i M L


19/55

January 14 Slide 19

Jacksonville, FL Home Prices Rise as Buyer Traffic Edges Higher and Inventories Move Lower


(4,582 single-family permits in 2012, 23rd largest market in the country)

Comments from Real Estate Agents: Slow start to the year. Buyers are pulling back due to price

appreciation of 2013. Buyers have greater economicuncertainty this year. Lack of inventory is driving fencesitting.

Lack of inventory and economic uncertainty. I have had good traffic in my farm area, a 55+ community.

Our Take: Traffic moved closer to a neutral level relative to expectations in

January as our index came in at 46 from 44 in December.Agents indicated that mediocre economic confidence, higherhome prices, and limited inventories all came as headwinds totraffic in the month.

Prices were broadly higher in January as our price indexlanded at 63 from 56 in December.

Inventory levels continued their slow decline in January as timeto sell also fell after lengthening in December, a positive forfuture pricing power.

0102030405060708090

100

J a n

- 1 2

F e b

- 1 2

M a r -

1 2

A p r -

1 2

M a y

- 1 2

J u n

- 1 2

J u l - 1 2

A u g

- 1 2

S e p

- 1 2

O c t - 1 2

N o v

- 1 2

D e c

- 1 2

J a n

- 1 3

F e b

- 1 3

M a r -

1 3

A p r -

1 3

M a y

- 1 3

J u n

- 1 3

J u l - 1 3

A u g

- 1 3

S e p

- 1 3

O c t - 1 3

N o v

- 1 3

D e c

- 1 3

J a n

- 1 4

B u y e r

T r a

f f i c I n d e x


0102030405060708090

100

J a n - 1

2

F e b - 1

2

M a

r - 1 2

A p

r - 1 2

M a y - 1

2

J u n - 1

2

J u l - 1 2

A u g - 1

2

S e p - 1

2

O c t - 1 2

N o v - 1

2

D e c - 1

2

J a n - 1

3

F e b - 1

3

M a

r - 1 3

A p

r - 1 3

M a y - 1

3

J u n - 1

3

J u l - 1 3

A u g - 1

3

S e p - 1

3

O c t - 1 3

N o v - 1

3

D e c - 1

3

J a n - 1

4

H o m e

P r i c e

I n d e x


MonthBuyer Traffic

Index Home Price

Index Incentive

Index Home Listings

Index Time to Sell


Point Change 2.1 6.3 (4.2) 2.1 14.6

25%

42%

33%



42% 42%

17%

42%50% 50%

17%8%

33%

0%10%20%30%40%50%

60%




L V NV B W f Hi h R t d E i d P i St bilit


20/55

January 14 Slide 20

Las Vegas, NV Buyers Wary of Higher Rates, and Economic and Price Stability



Comments from Real Estate Agents: There is apprehension over rates and if more inventory is

released, and the potential implications to home prices. Unemployment, new loan requirements, higher home prices

and a lack of decent inventory are all keeping buyers on thesidelines.

Buyers are holding back. Money is tight for buyers and prices continue to rise. There is less investor activity and rates are rising. Values

have declined in the past two months. Lending is strict, andthere are job stability concerns.

Our Take: Our January traffic index indicated that levels remained short of

agents expectations, as our index came in at 29, down from33 in December, and short of a neutral 50. Agents indicatedthat a lack of quality inventory, higher rates, and concerns overeconomic and pricing stability kept buyers at bay.

Prices edged lower in January, as our Home Price Index camein at 44 (unchanged from December), just shy of a neutral 50.

We think prices will likely face pressure, as both inventoriesand the time to sell both increased in January. These arenegative signs for future pricing.

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H o m e

P r i c e

I n d e x


MonthBuyer Traffic

Index Home Price

Index Incentive

Index Home Listings

Index Time to Sell


Point Change (3.9) (0.3) 2.8 1.1 (2.9)

6%

47%

47%



12%

50%

76%65%50%

24%24%

0% 0%0%

20%

40%

60%

80%

100%




L A g l CA B R E t th M k t M ti t d b Li it d I t i


21/55

January 14 Slide 21

Los Angeles, CA Buyers Re-Enter the Market, Motivated by Limited Inventories


(4,921 single-family permits in 2012, 22nd largest market in the country)

Comments from Real Estate Agents: A lack of active listings is limiting the market, so those folks

that are seriously wanting to purchase are out and ready togo.

Inventory is low, but buyers are motivated to purchase

before interest rates increase and housing isnt asaffordable. We seem to be having an influx of upper and middle level

management positions being filled from the U.K. and theeast coast.

Rising interest rates is causing buyers to act.

Our Take: Buyer traffic in January improved to meet expectations, as our

traffic index increased to 50 from 33 in December. Agentsindicated that buyers were actually motivated by a lack ofinventory, as they wanted to secure contracts before interestrates increased further. Agents also cited better demand fromrelos in January.

Prices were higher, as our Home Price Index increased to 78from 61 in December, above a neutral 50.

Inventories fell in January, which we view as a positive forfuture pricing trends.

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credit suisse survey of real estate agents jan. 2014 results

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