January 20, 2005

Closings for the year for all single family were up 12% from 2003. This is the greatest increase since 1998-
1999’s 13.8% increase.

Condos and townhomes became a huge part of our real estate market, as they increased 29.1% in 2004.
Single family detached had not as great an increase, but still posted a double digit gain of 10%.

Atlanta Metro has averaged 45,000 closings for new home construction for the past 4 years. This is also the
number 1 new home construction market in the US during this time. This expansion in housing has
translated into a major metro housing industry for Atlanta.

In 1996, we reported 35,839 closings. However, even though we had a strong housing market before and
during the 1996 Olympics year, it does not compare to our post Olympic growth in housing. There were
65,907 closings in 2004 or almost double what they were in 1996. The annualized growth rate has been a
very strong 8% since the Olympics.

December’s results were basically an extension of 2004’s previous 11 months. Closings for all single family
housing increased 9.6% from the same year ago period. Plus, after lagged closings are reported we will have
had 6 double digit monthly increases for the year.

The average sale price for all single family increased only 3% from 2003 to 2004. This is the third time in
the past 4 years that the average price increased 3%, while 2002 had a 4.6% increase.

Condos and townhomes actually realized a decline in 2004 from 2003 with respect to average sale price. The
average price for condos and townhomes was $187,656 in 2003, while $186,042 or a decline of 0.9% in
2004.

Atlanta Metro still is a very affordable housing market compared to other major US metro areas. Our
average sale price of $233,575 for all single family housing in 2004, combined with the lowest interest rates
in decades, provided very affordable housing in Atlanta in 2004.

Average days-on-market declined for all single family housing from 2003 to 2004. This was also the first
yearly decline for all single family housing since 1999. However, days-on-market increased the last three
months in 2004 from the same year ago periods. I believe this was due from more “stagnant” inventory
being sold off rather than the overall market time increasing.

We now head into 2005. All signs point to a strong 2005, as interest are still very low, gas prices are coming
down, Delta is still flying, and the economy is getting stronger.

Thank you,

Steve Palm
Smart Numbers

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