7th Annual Economic & Real Estate Forecast Loyola University, Roussel Hall A Partnership with NOMAR, CID, & Loyola University

GNO Real Estate Market - 2017 Phase I - PEAK Unit Sales Increasing Prices Increasing Inventory Decreasing Phase II CORRECTION Unit Sales Decreasing Prices Increasing Inventory Increasing Phase III TROUGH Unit Sales Decreasing Prices Decreasing Inventory Increasing Phase IV RECOVERY Unit Sales Increasing Prices Decreasing Inventory Decreasing

Supply and Demand is at Equilibrium & The Market continues to transition… Signs: Prices softening especially in the higher price brackets (all markets) D.O.M. increased by 20%

Seller’s Markets Greater New Orleans Area Single Family- Active Listings vs. Sold Listings Jan. 1989 – Jun. 2017 Seller’s Markets Source: LATTER & BLUM Research Division. This representation is based in whole or in part on data supplied by New Orleans Metropolitan Association of Realtors, St. Tammany Association of Realtors, Tangipahoa Board of Realtors, Baton Rouge Board of Realtors or their Multiple Listing Services. Neither the Boards, Associations, nor their MLS guarantees or is in any way responsible for its accuracy. Data maintained by the Boards, Associations or their MLS may not reflect all real estate activity for all years.

Seller’s Markets & Flood Impact Greater Baton Rouge Area Single Family- Active Listings vs. Sold Listings Jan. 1989 thru Jun. 2017 Seller’s Markets & Flood Impact Source: LATTER & BLUM Research Division. This representation is based in whole or in part on data supplied by New Orleans Metropolitan Association of Realtors, St. Tammany Association of Realtors, Tangipahoa Board of Realtors, Baton Rouge Board of Realtors or their Multiple Listing Services. Neither the Boards, Associations, nor their MLS guarantees or is in any way responsible for its accuracy. Data maintained by the Boards, Associations or their MLS may not reflect all real estate activity for all years.

Household Creation in USA 2000 - 2016

Households - Renting VS Owning +7% +36%

Housing Supply Nationally

Market Conditions 1st Timers Historically…40% -44%

Millennials…are sitting out!

What did they see?

What did they see? The biggest housing bubble burst in history 12.5% of all home mortgages - 10 Million people (200,000 per state) underwater 7 Trillion in Real Estate wealth destruction!

Impacts on the Trend Line… Rising Interest Rates

Impacts on the Trend Line… Available Credit

Foreclosure rate - 1/20th typical Fannie Mae

Homeownership Tenure People holding on to their homes longer!

GNO Area - Months of Inventory Pended Sales Rate 2017, Q3 – 4.4 Months 2017, Q1 – 3.1 Months 2016 - 4.0 Months 2015 - 5 Months 2014 - 5.8 Months 2013 - 7.1Months 2012 - 7.5 Months 2011 - 10.4 Months

Are we in a bubble now? No… inventory shortages are driving price increases!

Impacts on the Trend Line… Inventory Shortages New Construction in “Sweet Spot” pricing

Impacts on the Trend Line… Crime Prevention Success

Impacts on the Trend Line… Crime Prevention Success OUR VISION is to ensure all students in New Orleans read at grade level by the end of third grade

Dr. Bob gets it….

Latter & Blum Companies Thank you! Rick Haase, President Latter & Blum Companies rhaase@latterblum.com