Las Vegas Resale Homes Statistics:

    November ‘06                December ‘06              January ‘07

For Sale      19,729             For Sale      17,834           For Sale     18,774

New Listings 4043              New Listings 3196            New Listings 5809

Sold            1547                Sold           1644               Sold            1397

Resale Home Market Trends:

Over the last five years, the median home price has grown tremendously. Nationally, the median price rose 25% over this
period, but some markets grew in excess of 200%. This run up in prices was precipitated by the sharp fall in mortgage
rates from 2000 through 2005, which improved affordability. But over time, prices were bid up to the point that
affordability fell to its long term trend. In some markets, however, the feeding frenzy caused affordability to fall below
the long term average.

Today, affordability is squeezed and home buyers are focused, more than ever, on the bottom line; the monthly mortgage
payment. While prices have reached dizzying heights, what matters to buyers is this simple actuarial accounting.
Currently monthly payments are too far out of bounds for many first time and trade up buyers.

Sellers should be keen to note this trend, but as of yet they have resisted. While non-price concessions are on the rise (it is
hard to quantify this as there is no data to track, but regular discussions with brokers and agents supports the claim that
this trend is widespread), price concessions have been few and far between. Sellers, who’ve seen their neighbors make
tremendous profits over the last 6 years expect to reap the same reward. In fact, they often come into the process with a
figure in their head of what they expect to make. This seller psychology makes it hard to convince them of alternative
pricing strategies that could save them money and consternation in the long term.

Currently, about 70% of the markets around the U.S. are experiencing declining sales, while 30% are still growing.
Astonishingly, while sales have fallen, in most markets prices continue to rise! How can this happen? By refusing to take
concessions, sellers are driving buyers to the sidelines. The best properties are moved at the higher prices, while the rest
sit.

Truthfully, some sellers, particularly trade up buyers, are in a bind where they have purchased their trade up property
expecting to be able to use the proceeds from their home on the market. With affordability stretched, they are likely to
take a loss if they don’t realize all of the gains from their first property. Consequently, they face an immediate bite to
equity and may choose to cling to a high asking price. But this is a special case and hardly typical of all sellers.