This report was generated on April 26, 2011 State of the Market This report was generated on April 26, 2011

Nationally Sales of existing-home sales rose in March, continuing an uneven recovery that began after sales bottomed last July, according to the National Association of Realtors®. Existing-home sales1, which are completed transactions that include single-family, townhomes, condominiums and co-ops, increased 3.7 percent to a seasonally adjusted annual rate of 5.10 million in March from an upwardly revised 4.92 million in February, but are 6.3 percent below the 5.44 million pace in March 2010. Sales were at elevated levels from March through June of 2010 in response to the home buyer tax credit.

Nationally Lawrence Yun, NAR chief economist, expects the improving sales pattern to continue. “Existing-home sales have risen in six of the past eight months, so we’re clearly on a recovery path,” he said. “With rising jobs and excellent affordability conditions, we project moderate improvements into 2012, but not every month will show a gain – primarily because some buyers are finding it too difficult to obtain a mortgage. For those fortunate enough to qualify for financing, monthly mortgage payments as a percent of income have been at record lows.” NAR’s housing affordability index shows the typical monthly mortgage principal and interest payment for the purchase of a median-priced existing home is only 13 percent of gross household income, the lowest since records began in 1970.

Nationally “Given that FHA and VA government-backed loan programs turned a modest profit over to the U.S. Treasury last year, and have never required a taxpayer bailout, we believe low-downpayment loans should continue to be available for those consumers who have demonstrated financial responsibility and are willing to stay well within their budget. Raising the downpayment requirement would unnecessarily deny credit to many worthy middle-class families and veterans,” Yun said. A parallel NAR practitioner survey2 shows first-time buyers purchased 33 percent of homes in March, compared with 34 percent of homes in February; they were 44 percent in March 2010. All-cash sales were at a record market share of 35 percent in March, up from 33 percent in February; they were 27 percent in March 2010. Investors accounted for 22 percent of sales activity in March, up from 19 percent in February; they were 19 percent in March 2010. The balance of sales were to repeat buyers.

Nationally The national median existing-home price3 for all housing types was $159,600 in March, down 5.9 percent from March 2010. Distressed homes – typically sold at discounts in the vicinity of 20 percent – accounted for a 40 percent market share in March, up from 39 percent in February and 35 percent in March 2010. Total housing inventory at the end of March rose 1.5 percent to 3.55 million existing homes available for sale, which represents an 8.4-month supply4 at the current sales pace, compared with a 8.5-month supply in February.

Nationally Regionally, existing-home sales in the Northeast rose 3.9 percent to an annual level of 800,000 in March but are 12.1 percent below March 2010. The median price in the Northeast was $232,900, down 3.0 percent from a year ago. Existing-home sales in the Midwest increased 1.0 percent in March to a pace of 1.06 million but are 13.1 percent lower than a year ago. The median price in the Midwest was $126,100, which is 7.1 percent below March 2010. In the South, existing-home sales rose 8.2 percent to an annual level of 1.99 million in March but are 1.0 percent below March 2010. The median price in the South was $138,200, down 6.6 percent from a year ago. Existing-home sales in the West slipped 0.8 percent to an annual pace of 1.25 million in March and are 3.1 percent below a year ago. The median price in the West was $192,100, which is 11.2 percent lower than March 2010.

March Maricopa/Pima/Pinal Market Residential Homes SFH, Condos, TwnHms The ASP of Closed homes was $162 However, the ASP of Listings is $201 The SP/LP ratio is running 96.2% There were 13,923 New Listings LM Bringing the current listing Inv to 42,418 but has been on a steady decline for the last 6 months Last month, 10,801 homes closed escrow 11,638 listings received an Accepted Offer The avg $/SF is running $77/ft. There continues to be a very strong appetite for lower priced homes March sales were up 11.2% from March of LY and up 38.6% from LM and the largest month in 3 years! There is currently a 3.9 MSI Inventory is Trending Down - Sales are up – Price Driven Market – Slowly getting better

Distressed Property Report   ACTIVE LISTINGS SHORT SALES REO % DISTRESSED SOLD LISTINGS By County Maricopa County 31,448 11,834 4,839 53.02% 9,246 1,650 3,887 59.89% Pima County 8,033 1,651 1,510 39.35% 1,194 102 685 65.91% Pinal County 3,229 1,278 432 52.96% 1,212 202 516 59.24% Prescott MLS 2,025 247 270 25.53% 250 22 124 58.40% Lake Havasu MLS 2,696 159 286 16.51% 470 32 190 47.23% Green Valley MLS 941 34 30 6.80% 121 3 8 9.09%

March sales stats for Lake Havasu Total homes sold 168 Average Sales price $168,593 Median sales price $139,950 Average days on the market 121 List price to sales price ratio 94% Average price per sq. ft. $103 Total sold foreclosures / short sales-69   (41%) Foreclosure inventory is down and still more than half of the homes sold have been cash sales!

Prescott Market The Prescott Area saw continued increases in both units sold and sales volume in March of 2011, compared with March of 2010. The median price of a Single Family Home, for the first quarter of 2011, compared with the first quarter of 2010, is down 12%. Months of inventory for single family homes stood at 6.5 in March of 2011, 40% less than the MOI in March of 2010. Single Family Homes At A Glance Change Results Mar ‘11 vs Mar ‘10 2011 vs 2010 (ytd) Mar ‘11 Mar ‘10 Feb ‘11 Homes Sold 26% 18% 288 229 196 Median Sales Price 12% $129,900 $159,000 $136,450 Sales Volume 13% $47.8m $42.6m $35.8m Active Listings 25% - 1845 2493 1903 Months of Inventory 40% 6.5 10.9 9.8 Average Days on Market 3% 2% 148 138 162