What Drives the Demand for Housing?

-2%

0%

2%

4%

6%

8%

10%

12%

'90 '93 '96 '99 '02 '05 '08 '11

Population Growth

-15%

-10%

-5%

0%

5%

10%

15%

'90 '93 '96 '99 '02 '05 '08 '11

Employment Growth

-20%

-15%

-10%

-5%

0%

5%

10%

15%

20%

'90 '93 '96 '99 '02 '05 '08 '11

Taxable Sales Growth

Source: Nevada State Demographer, US Bureau of Labor Statistics & Nevada Department of Taxation

Broader Economic Conditions Population Growth

-0.5%

0.0%

0.5%

1.0%

1.5%

2.0%

2.5%

3.0%

3.5%

North

Dak

otaDi

strict

of C

olumb

iaUt

ahCo

lorad

oTe

xas

Neva

daSo

uth D

akota

Florid

aAr

izona

Was

hingto

nSo

uth C

aroli

naW

yomi

ngIda

hoNo

rth C

aroli

naHa

waii

Monta

naDe

lawar

eOk

lahom

aVi

rgini

aCa

liforn

iaOr

egon

Geor

giaMi

nnes

otaMa

rylan

dUn

ited S

tates

Mass

achu

setts

Nebr

aska

Alas

kaTe

nnes

see

Louis

iana

Indian

aIow

aNe

w Yo

rkNe

w Je

rsey

Kentu

cky

Alab

ama

Miss

ouri

Arka

nsas

Wisc

onsin

Kans

asMi

ssiss

ippi

Ohio

New

Hamp

shire

Mich

igan

Conn

ectic

utRh

ode I

sland

Illino

isVe

rmon

tNe

w Me

xico

Penn

sylva

niaMa

ineW

est V

irgini

a

Source: US Census

North Dakota +22,048 District of Columbia +13,022 Utah +46,001 Colorado +78,909 Texas +387,397 Nevada +35,782

“The largest over-the-year percentage increase occurred in

North Dakota (+5.2 percent), followed

by Nevada (+3.8 percent) and Florida

(+3.3 percent).”

Prospect Visits per Month Greater Reno-Sparks-Tahoe

0

2

4

6

8

10

12

14

16

Jul-1

1

Sep-

11

Nov-1

1

Jan-

12

Mar-1

2

May-1

2

Jul-1

2

Sep-

12

Nov-1

2

Jan-

13

Mar-1

3

May-1

3

Jul-1

3

Sep-

13

Nov-1

3

Jan-

14

Mar-1

4

Source: Economic Development Authority of Western Nevada

Prospect Visits per Month Greater Reno-Sparks-Tahoe

0

2

4

6

8

10

12

14

16

Jul-1

1

Sep-

11

Nov-1

1

Jan-

12

Mar-1

2

May-1

2

Jul-1

2

Sep-

12

Nov-1

2

Jan-

13

Mar-1

3

May-1

3

Jul-1

3

Sep-

13

Nov-1

3

Jan-

14

Mar-1

4

Source: Economic Development Authority of Western Nevada

2011 Avg. = 4.2

2012 Avg. = 7.8

2013 Avg. = 9.8 2014 Avg. = 10.8

Assisted New Jobs Greater Reno-Sparks-Tahoe

3,460

0

500

1,000

1,500

2,000

2,500

3,000

3,500

4,000

2008 2009 2010 2011 2012 2013Source: Economic Development Authority of Western Nevada; *2008-2010 estimate based on 1-year numbers

5 Year Average*

New Home Closings Statewide

17,122

26,944

26,524

31,308

37,065

45,455

42,009

'00 '01 '02 '03 '04 '05 '06 '07 '08 '09 '10 '11 '12 '13Source: CoreLogic

New Home Closings Statewide

17,122

26,944

26,524

31,308

37,065

45,455

42,009

23,616 11,862

6,487

7,104

6,327

8,433

'00 '01 '02 '03 '04 '05 '06 '07 '08 '09 '10 '11 '12 '13Source: CoreLogic

New Home Closings Statewide

17,122

26,944

26,524

31,308

37,065

45,455

42,009

23,616 11,862

6,487

7,104

6,327

8,433

9,310

'00 '01 '02 '03 '04 '05 '06 '07 '08 '09 '10 '11 '12 '13Source: CoreLogic

+10.4%

New Home Median Sales Pricing Statewide

$187,500

$283,800

$150,000

$170,000

$190,000

$210,000

$230,000

$250,000

$270,000

$290,000

Source: CoreLogic

Existing Home Sales & Pricing Statewide

0500

1,0001,5002,0002,5003,0003,5004,0004,500

Jan-

12Ap

r-12

Jul-1

2Oc

t-12

Jan-

13Ap

r-13

Jul-1

3Oc

t-13

Jan-

14

Closings

Source: CoreLogic

-20%

-10%

0%

10%

20%

30%

40%

50%

$60

$80

$100

$120

$140

$160

$180

Jan-

12Ap

r-12

Jul-1

2Oc

t-12

Jan-

13Ap

r-13

Jul-1

3Oc

t-13

Jan-

14

Thou

sand

s

Median Sales Price Median Price

Y-O-Y Growth

State House Price Index Q1 2014 1-Year Change

Source: Federal Housing Finance Agency, Purchase-Only Index, Seasonally Adjusted

Less than 0%

0% to 6%

6% to 10%

10% to 14%

Greater than 14%

#1

Residential Permitting Statewide

0

1,000

2,000

3,000

4,000

5,000

6,000

7,000

Source: US Census

Peak to Present: -4,695 (-79.7%)

Residential Permitting Statewide

0

1,000

2,000

3,000

4,000

5,000

6,000

7,000Multi-Family Single-Family

Source: US Census

Northern Nevada Snapshot

0

100

200

300

400

500

600

700

800

900

'06 '07 '08 '09 '10 '11 '12 '13 '14

Home Closings

New Existing

$0

$50

$100

$150

$200

$250

$300

$350

$400

$450

'06 '07 '08 '09 '10 '11 '12 '13 '14

Thou

sand

s

Median Sales Price

New Existing

0

100

200

300

400

500

600

'06 '07 '08 '09 '10 '11 '12 '13 '14

Residential Units Permitted

Source: UNR Center for Regional Studies, UNLV Center for Business & Economic Research

Interests Rates Are Cheap, Yet Loans Are Still Declining

Source: CoreLogic

0%

1%

2%

3%

4%

5%

6%

7%

8%

200

250

300

350

400

450

500

550

'01 '02 '03 '04 '05 '06 '07 '08 '09 '10 '11 '12 '13 '14

Thou

sand

s

Statewide Loan Count 30-Year Conventional Mortgage Rate

Loans 30 Days Past Due

Source: Mortgage Bankers Association, National Delinquency Survey Q1 2014

Less than 1.5%

1.5% to 2.4%

2.5% to 3.2%

3.3% or More

#43

US Average: 2.4% Nevada: 1.7%

Loans Seriously Delinquent

Source: Mortgage Bankers Association, National Delinquency Survey Q1 2014

Less than 3.0%

3.0% to 4.9%

5.0% to 6.9%

7.0% or More

Nevada: 7.3% US Average: 5.0%

#4

Share of Homes with High Leverage

Note: Represents the share of homes that have a loan-to-value ratio of 80 percent or higher. Source: CoreLogic

Real Estate Sector Res. Supply to Play a Role, But New Investments a Plus

0

1

2

3

4

5

6

2010 2011 2012 2013 2014

Effe

ctive

Inve

ntor

y (Mo

nths

)

Loans Share of

O/S Loans National

Rank

30 Days 7,710 1.7% 43

60 Days 3,011 0.7% 40

90 Days + 17,199 3.8% 2

Foreclosures 16,013 3.5% 8

Total 43,934 9.6% 13

Resale Availability (MLS)* Mortgage Delinquency

Note: National rank (1=Highest Rate)

Source: SalesTraq & Mortgage Bankers Association, National Delinquency Survey Q1 2014 Note: Refers only to the Las Vegas area

107,622

52,195

0

20

40

60

80

100

120

'07 '08 '09 '10 '11 '12 '13 '14Th

ousa

nds

Subprime Loans

Potential Housing Market Issues

Source: Mortgage Bankers Association, National Delinquency Survey

220,082

65,359

0

50

100

150

200

250

'07 '08 '09 '10 '11 '12 '13 '14

Thou

sand

s

ARM Loans 56,028

16,013

0

10

20

30

40

50

60

'07 '08 '09 '10 '11 '12 '13 '14

Thou

sand

s

Foreclosure Inventory

#17 #19 #24

Fannie Mae & Freddie Mac State Borrower Assistance Map

Source: Federal Housing Finance Agency, through December 31, 2013

33,001 Loan Modifications

Homeowner’s Equity

Source: CoreLogic

Positive 54.6%

Under Water 45.4%

Q1 2013

Positive 70.6%

Under Water 29.4%

Q1 2014

Positive 38.8% Under

Water 61.2%

Q1 2012

Negative Equity by State

Source: CoreLogic

0%

5%

10%

15%

20%

25%

30%

35%

NV FL AZ MS IL OH MI GA RI MD NH WI

NJ LA VA MO CT DE CA MA ID AR NM SC MN AL TN NC NE WA IA KY KS WV CO PA OR UT IN OK NY DC ME WY HI AK ND MT TX

Near Negative Equity

Negative Equity

Negative Equity by State

Source: CoreLogic

0%

5%

10%

15%

20%

25%

30%

35%

NV FL AZ MS IL OH MI GA RI MD NH WI

NJ LA VA MO CT DE CA MA ID AR NM SC MN AL TN NC NE WA IA KY KS WV CO PA OR UT IN OK NY DC ME WY HI AK ND MT TX

Negative Equity: 29.4% (#1) Near Negative Equity: 3.2% (#29)

Investor (“Cash”) Purchase Share Statewide

Source: Applied Analysis

50.9%

39.2%

20%

25%

30%

35%

40%

45%

50%

55%

'10 '11 '12 '13 '14

New to Existing Home Price Ratio Statewide

Source: CoreLogic

199.1% 164.0%

0%

50%

100%

150%

200%

250%

'00 '01 '02 '03 '04 '05 '06 '07 '08 '09 '10 '11 '12 '13 '14

The Concept of Value

REALTOR®

Seller

Buyer

Appraiser

Lender