Presentable Market Data

Understanding three views of the current market allows Buyers to maximize their ability to evaluate properties, receiving the highest value in their home search and Sellers to position their property to maximize money in their pocket while minimizing time on market: Macro View: National Market National Media Coverage Metro View: Atlanta Market Quarterly FMLS Market Report Micro View: Your Community Comparative Market Analysis Current Market Overview

Metro Areas Included – 36 FMLS Areas 3Q 2007 Quarterly Metro Market Profile Provided By Keller Williams Realty Condos/Townhomes and Single Family Detached Residences – 36 FMLS Areas

Keller Williams Realty rose from 4 th position in Atlanta Metro market share, to 2 nd position, in three years Keller Williams is the only top five company to increase its Atlanta market share every year since Q 2007 Quarterly Metro Market Profile Provided By Keller Williams Realty Condos/Townhomes and Single Family Detached Residences – 36 FMLS Areas

Cumulative monthly 2007 sales of Condo/Townhome residences were nearly equal to those of 2006 through March However, sales began to slow in the second quarter and remain 10% below 2006, but still 2% above Sept Some increase in September, 2007 sales will occur as lag processing catches up 3Q 2007 Quarterly Metro Market Profile Provided By Keller Williams Realty Condo/Townhome Residences – 36 FMLS Areas

Tracking monthly sales demonstrates the slowing sales during months after February, 2007 The faster start in Jan.- Feb. gave way to slower sales in the following months, with sales falling below 2005 levels after mid-year September sales should increase somewhat as lag closings are processed 3Q 2007 Quarterly Metro Market Profile Provided By Keller Williams Realty Condo/Townhome Residences – 36 FMLS Areas

2007 sales of Condo/Townhome residences were ahead of both 2005 and 2006 sales during 1Q 07 Sales in 2Q 07 trailed behind 2Q 06, but were still slightly ahead of 2Q 05 3Q 07 sales fell below those of both 3Q 05 and 06 3Q 2007 Quarterly Metro Market Profile Provided By Keller Williams Realty Condo/Townhome Residences – 36 FMLS Areas

<$200K $200- $499K $ K $750- $999K $1.0- $1.9M$2.0M+Total NEW 903 (-26%) 1,151 (-1%) 62 (-13%) 14 (100%) 7 (+17%) 2 2,139 (-13%) RESALE 4,053 (-11%) 1,521 (-6%) 84 (22%) 17 (-48%) 15 (50%) 1 (-50%) 5,691 (-10%) TOTAL 4,956 (-14%) 2,672 (-4%) 146 (4%) 31 (-23%) 22 (38%) 3 (50%) 7,830 (-11%) Looking at sales by New/Resale and by sales price range shows market segments where sales have been stronger than in 2006 Although the number of sales in price ranges above $500K are small, those segments are the ones showing improved sales in 2007 BetterSameWorse Comparison to one year ago: YTD September Sales 3Q 2007 Quarterly Metro Market Profile Provided By Keller Williams Realty Condo/Townhome Residences – 36 FMLS Areas

Sales of properties in the higher price ranges represent a larger portion of total sales this year, contributing to an overall median sales price increase 3Q 2007 prices remained nearly equal to 2Q 2007, which were the highest recorded for any quarter so far The YTD Sept., 2007 median sales price was 3.5% higher than that of the same period in 2006 and 5.5% higher than Q 2007 Quarterly Metro Market Profile Provided By Keller Williams Realty Condo/Townhome Residences – 36 FMLS Areas

The median sales price as a percent of original list price continued to decline during 2007, indicating stronger Buyer price resistance These measures for the last 3 quarters were lower than those of all other 2006 and all 2005 quarterly numbers, indicating that a difficult pricing environment continues for Sellers 3Q 2007 Quarterly Metro Market Profile Provided By Keller Williams Realty Condo/Townhome Residences – 36 FMLS Areas

The median % S/L price ratio is lower in each price range segment, except for the $750- $999K range S/L price ratios normally decline as prices go higher, likely reflecting the difficulty in pricing these properties 3Q 2007 Quarterly Metro Market Profile Provided By Keller Williams Realty Condo/Townhome Residences – 36 FMLS Areas

The overall median number of Days On Market is only slightly higher in 2007 than in the previous 2 years The median DOM has consistently remained below 90 days 3Q 2007 Quarterly Metro Market Profile Provided By Keller Williams Realty Condo/Townhome Residences – 36 FMLS Areas

Changes in median DOM by price segment shows a similar pattern of small changes in the price ranges below $750K Larger changes at the higher price levels were in the favor of Sellers (reductions), except for the $2Mil.+ category where there were very few sold 3Q 2007 Quarterly Metro Market Profile Provided By Keller Williams Realty Condo/Townhome Residences – 36 FMLS Areas

<$200K $200- $499K $ K $750- $999K $1.0- $1.9M$2.0M+Total NEW 105 Days +27% 116 Days +25% 124 Days +19% 173 Days -30% 174 Days -25% 114 Days 112 Days +27% RESALE 73 Days -8% 76 Days +4% 80 Days -1% 74 Days -51% 111 Days -43% 53 Days +96% 74 Days -5% TOTAL 78 Days -3% 89 Days +11% 97 Days +5% 102 Days -38% 117 Days -40% 83 Days +207% 82 Days +2% Looking at median DOM by market segment, shows that the improvement in the $750-$1.9K was for both new and resale units In other price segments, DOM improvements were in Resale units, only BetterSameWorse Comparison to one year ago: YTD September Days on Market 3Q 2007 Quarterly Metro Market Profile Provided By Keller Williams Realty Condo/Townhome Residences – 36 FMLS Areas

The trend towards Sellers paying some, or all, of their Buyer’s closing costs continues through 3Q 2007 at a very high percentage of transactions Seller’s should be aware of this Buyer need during contract negotiations and consider its affect on Seller net proceeds of sale 3Q 2007 Quarterly Metro Market Profile Provided By Keller Williams Realty Condo/Townhome Residences – 36 FMLS Areas

The percentage of transactions including Seller-paid closing costs usually declines for higher-priced residences This trend is illustrated by the fact that the percentage was nearly half, or less, as many transactions with Seller- paid closing costs, at price levels above $500K during Q 2007 Quarterly Metro Market Profile Provided By Keller Williams Realty Condo/Townhome Residences – 36 FMLS Areas

Sellers agreeing to pay some or all of their Buyer’s closing costs reduce their net percentage of original list price by another 1.6% of their original list price 3Q 2007 Quarterly Metro Market Profile Provided By Keller Williams Realty Condo/Townhome Residences – 36 FMLS Areas

The percentage of transactions where the Seller was required to reduce the listing price in order to attract a Buyer, has increased in 2007 The 37% rate for 3Q 2007 is above the normal range observed during the last 3 years A YTD percentage of 33% is near the high end of the usual range for price reductions, further indicating a higher level of Buyer price resistance in the current market 3Q 2007 Quarterly Metro Market Profile Provided By Keller Williams Realty Condo/Townhome Residences – 36 FMLS Areas

The percentage of transactions following a price reduction has been at a high level across the price range market segments Only one price grouping ($750-$999K) experienced a reduction in the number of transactions following a price reduction 3Q 2007 Quarterly Metro Market Profile Provided By Keller Williams Realty Condo/Townhome Residences – 36 FMLS Areas

When a price reduction is required, the Seller negotiates to a lesser portion of the original listing price than a Seller not requiring a price reduction This difference across the metro area typically ranges between 4-6 percentage points less than for a Seller with no price reduction Through 3Q 2007, the 5.4 percentage point difference would amount to a reduction of $9,700 at the median sales price, compared to a Seller without a price reduction 3Q 2007 Quarterly Metro Market Profile Provided By Keller Williams Realty Condo/Townhome Residences – 36 FMLS Areas

Sellers of higher priced residences who are required to reduce their list price, tend to be penalized to a greater degree than those at lower price ranges However, regardless of price range, Sellers who price in line with the current market (no price reduction required) are able to sell at a high (nearly 98%) S/L ratio 3Q 2007 Quarterly Metro Market Profile Provided By Keller Williams Realty Condo/Townhome Residences – 36 FMLS Areas

Even after taking a price reduction, Sellers usually realize an equal or lesser, portion of their new list price than those Sellers not required to reduce their price 3Q 2007 Quarterly Metro Market Profile Provided By Keller Williams Realty Condo/Townhome Residences – 36 FMLS Areas

When a price reduction is required, more time is needed to attract a buyer Typically, the Seller with a price reduction needs 2-3 times longer to sell than the Seller not required to reduce their listing price The likely results are higher carrying costs, greater inconvenience due to keeping the house in showing condition and delays in finding and moving to a new home 3Q 2007 Quarterly Metro Market Profile Provided By Keller Williams Realty Condo/Townhome Residences – 36 FMLS Areas

A days on market difference exists at all price levels for Sellers requiring a price reduction compared to those not requiring a reduction The difference here shows ranges from times longer to sell The number of sales at $2M+ were too small (3) to draw a meaningful conclusion 3Q 2007 Quarterly Metro Market Profile Provided By Keller Williams Realty Condo/Townhome Residences – 36 FMLS Areas

Failed listings are viewed here as a percentage of total listings, so as to not overstate the trend Failed listings as a percent of total listings (exp., WD, closed) began to rise during the 2 nd half of 2006 and have continued an upward pattern after a 1Q 2007 downtrend The consistently high failure rate is further evidence of Buyer price resistance, since listings usually fail due to overpricing 3Q 2007 Quarterly Metro Market Profile Provided By Keller Williams Realty Condo/Townhome Residences – 36 FMLS Areas

Considering that 58% of 2007 finalized listings are “Failed” listings (likely due to overpricing) and 33% of the remaining (closed) listings have had a price reduction, it follows that 72% of all finalized listings were overpriced during 2007 Pricing in line with the current market and high-level property condition are essential to sales success, particularly in a slower market Overpriced Listings Expired + Cancelled = 58% Price Reduced: 42% x33 %=14% Percent of Finalized Listings: (58%+14%)= 72% 3Q 2007 Quarterly Metro Market Profile Provided By Keller Williams Realty Condo/Townhome Residences – 36 FMLS Areas

The listings supply continues to grow in each month of 2007 Inventory is expressed as the number of months required to sell currently active listings, at the average monthly sales rate during the last 12 months Supply has increased by 40% since December, 2006, but has not increased in September 3Q 2007 Quarterly Metro Market Profile Provided By Keller Williams Realty Condo/Townhome Residences – 36 FMLS Areas

<$200K $200- $499K $ K $750- $999K $1.0- $1.9M$2.0M+Total NEW 8.3 Months +41% 15.2 Months +33% 35.5 Months +121% 38.1 Months -12% 58.7 Months +3% Months 13.2 Months +43% RESALE 9.3 Months +36% 14.4 Months +44% 19.6 Months +22% 20.6 Months +96% 21.5 Months -27% 84.0 Months +56% 10.8 Months +39% TOTAL 9.1 Months +37% 14.7 Months +39% 26.2 Months +63% 27.7 Months +64% 33.4 Months -15% Months -19% 11.5 Months +40% The listings inventory has improved for new units priced $750- $999K and for resale units priced $1.0- $1.9M There were no sales in the $2.0M+ price range in 2006, but there were listings at that price Months of inventory are generally higher for properties in higher price ranges BetterSameWorse Comparison to December, 2006: YTD September Months Supply of Listings 3Q 2007 Quarterly Metro Market Profile Provided By Keller Williams Realty Condo/Townhome Residences – 36 FMLS Areas

The Condo/Townhome residence market began slowing after March of 2007, compared to the first half of However sales of higher-priced ($500K+) units have been stronger. Despite slowing sales, median sales prices have continued to increase slightly (3%). This is likely due a larger portion of units selling in the higher price ranges than during However, evidence of a more difficult market for Sellers is shown by a lower S/L price ratio, slightly increased DOM, larger percentage of transactions occurring after a price reduction, higher percent of failed listings and continuing increases in the months supply of listings. Conclusion: The real estate market in Atlanta entered a “transition” phase in the 4 th quarter of After very strong markets in 2005 and early 2006, interest rates edged up slightly, affecting the borrowing power of some potential Buyers. The low-price end of the market was most affected, while the higher priced segments continued to advance. New home sales in the lower price segment, were most severely impacted. Sellers will need to pay close attention to preparation of their property for sale and pricing in line with the slower market and high inventory of listings in order to sell at the best price in the shortest amount of time. Correctly priced, ready-to-sell properties are selling in a median of less than 60 days and at more than 98% of original list price. 3Q 2007 Quarterly Metro Market Profile Provided By Keller Williams Realty Condo/Townhome Residences – 36 FMLS Areas SUMMARY

Relevance to Sellers in 2007: Houses have sold at increased prices compared to the previous year, indicating a sound overall real estate market – however, increased time on market, lower % S/L prices and high percentages of transactions requiring a price reduction indicate that pricing at the current market is the key to selling in least amount of time and at the best price. The biggest concern going into the 4 th quarter of 2007 is the high inventory of homes for sale at all price levels and a further slowing of sales compared to 2006, indicating a continuation of 4Q 2006 market slowing. The high percentage of failed listings and an increase in the percentage of transactions following a price reduction, may indicate increasing Buyer price resistance. Market slowing will continue until inventories return to more normal rates – until then, pricing in line with the current market and higher-level property condition are needed to insure optimal results for Sellers. More attention should be paid to pricing below comparable properties currently on the market, as opposed to ones which sold several months ago. Relevance to Buyers: Builders may offer Buyer incentives to work down high new home inventory. Greater price increases in new homes (+8.2%) than in resales (+3.3%) may create better value in resales in Market slowing will present better value to Buyers of both resale and new homes. Properties that have been price-reduced may set up a more favorable negotiating environment. Buyers should ask the Seller to pay some, or all, of Buyer’s closing costs. 3Q 2007 Quarterly Metro Market Profile Provided By Keller Williams Realty Condo/Townhome Residences – 36 FMLS Areas