2016 Market Presentation Indiana Brokers Association November 15, 2016 Steve Lains, CEO Builders Association of Greater Indianapolis

BAGI Mission BAGI Mission: Promote, Educate & Network 15,000 Attendees Builder/Realtor Collaboration

Why New Construction? 90% of area builders are BAGI Members BAGI has approximately 200 builder members New Construction – $1.8 billion economic impact New Home Construction – 5,600 annually 10 Builders account for 70% of those homes

Why New Home Construction? Benefits Move-in ready Warranty It’s all new Whole home certification Ease of financing Energy Code/Standards Ease of process for the realtor BAGI Standards

How to Find New Construction Inventory: BAGI How to Find New Construction Inventory: BAGI.COM – Find a Home & Find a Builder

Current Market Stats Previous Starts and Housing Forecast of Starts 2016 – 5,600 ‘17 to ‘18 - +10%? 2019 – 7,500? 2021+ - slight decrease?

Market Share by County Based on Building Permits Issued 76% “Northwest” Marion County Johnson County

Average Price of New Homes by County Based on Closings 8 of 9 counties record highest average (Hamilton County highest in 2015)

Dollar Volume Forecast of Homes and The Average Price of Housing $1 Dollar Volume Forecast of Homes and The Average Price of Housing $1.8 billion volume 70+% under $325k

Homes Needed Annually = Lots needed Current DVL lots – 10k Home Demand ’21 – 35k DVL lots needed ‘21 – 25k

New Home Subdivisions (Started and Projected to Start) No overbuilding trends: Subdivisions – 552 40% of peak Lots – 9,888 35% of peak Net Home Inventory – 611* 35% of peak * - less 172 models

Market Perspectives Demographics Industry: 10 builders do 70% of market share Consumer: Empty Nester/Millennial Government: Tax Caps = $400+ Homes

Demographics - Industry 500 Members 200 Builders 10 Builders doing 70% of market share 10 Builders shift in price point 10 years – first time home buyers Today – 8 of 10 in 300K+

Demographics - Consumer Millennials Price Sensitive Amenities Apartments

Demographics - Consumer Empty Nesters Price Sensitive Apartments

Demographic - Government Tax Caps = $400k+ Homes Fiscal Impact Study Community Tax Cap Study Additional Regulations Architectural Standards Lot size House size Bonds, etc.

Collaboration Next Steps Keep the lines of communication open between BAGI, MIBOR & Brokers Association Continuing Education opportunities/Construction 101 hosted by BAGI for realtors BAGI/MIBOR must advocate for housing growth and economic development (i.e. providing input on changing decade old development standards/ordinances to meet today’s buyers needs

Questions?