1. Market Update Gathering of Eagles Billionaires Meeting May 2011

2. Market Update REAL Trends Housing Market Forecast

3. Market Update The 5% Rule Going Forward To “burn off” the ‘99-’07 overage and get back onto the 5% trendline will require no more than 3-4% sides growth until 2016 To “burn off” the ‘99-’07 overage and get back onto the 5% trendline will require no more than 3-4% sides growth until 2016 2005 peak is not supposed to trend again until 2030 2005 peak is not supposed to trend again until 2030

4. Market Update Potential Race and Age Challenges Well over half of all new household formations over the next decade are expected to come from the non-White population Well over half of all new household formations over the next decade are expected to come from the non-White population Yet the REALTOR® membership today remains 87% White with little change in trends Yet the REALTOR® membership today remains 87% White with little change in trends

5. Market Update Age Issues (2010 NAR Member Profile) REALTOR® Median age: 54 (and increasing) REALTOR® Median age: 54 (and increasing) US Population Median age: 37 US Population Median age: 37 Percent of REALTORS® under 40 years-old: 15% (and dropping) Percent of REALTORS® under 40 years-old: 15% (and dropping) Percent of US Population between 20 and 40 years-old: 34% Percent of US Population between 20 and 40 years-old: 34%

6. Market Update

7. Put Another Way…

8. Market Update Dropping Homeownership Rate U.S. Homeownership rate peaked at about 69- 70% in 2007 U.S. Homeownership rate peaked at about 69- 70% in 2007 It is currently at about 67% It is currently at about 67% Most economists are forecasting this to drop to between 63% and 65% within five years Most economists are forecasting this to drop to between 63% and 65% within five years Wide implications to brokerage industry Wide implications to brokerage industry

9. Market Update Possible Solutions?

10. Thank You Gathering of Eagles Billionaires Meeting May 2011