Partners Trust La Cañada Grand Opening: 2014-2015 California Economic Outlook presented by Leslie Appleton-Young, Chief Economist of the California Association of Realtors®

2014 - 2015 CALIFORNIA
ECONOMIC & MARKET
OUTLOOK
November 20,2014
Partner’s Trust La Canada
Appleton-Young, Chief Economist

OVERVIEW
• Economic Outlook
• California Housing Market Outlook
• Housing Affordability
• Regional Market
• 2015 Forecast

ANNUAL PERCENT CHANGE, CHAIN-TYPE (2005) $
5%
4%
3%
2%
1%
0%
-1%
-2%
-3%
-4%
ECONOMY: GAINING MOMENTUM
2013: 1.9%; 2014: 2.2%; 2015: 3.0%; 2014 Q3: 3.5%
ANNUALLY QUARTERLY
2009 Largest Annual Drop since 1938 (-3.4%)
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014 P
Q2-10
Q3-10
Q4-10
Q1-11
Q2-11
Q3-11
Q4-11
Q1-12
Q2-12
Q3-12
Q4-12
Q1-13
Q2-13
Q3-13
Q4-13
Q1-14
Q2-14
Q3-14
SERIES: GDP
SOURCE: US Dept. of Commerce, Bureau of Economic Analysis

-3%
-2%
-1%
0%
1%
2%
3%
4%
5%
2005
2006
2007
2008
2009
2010
2011
2012
2013
2010 Q2
2010 Q3
2010 Q4
2011 Q1
2011 Q2
2011 Q3
2011 Q4
2012 Q1
2012 Q2
2012 Q3
2012 Q4
2013 Q1
2013 Q2
2013 Q3
2013 Q4
2014 Q1
2014 Q2
2014 Q3
CONSUMER SPENDING POSITIVE
2013: 2.0%; 2014 Q3: 1.8%
ANNUAL PERCENT CHANGE
ANNUALLY QUARTERLY
SERIES: Personal Consumption
SOURCE: US Dept. of Commerce, Bureau of Economic Analysis

US UNEMPLOYMENT RATE BELOW 6%
CA - 7.3% (Sep. 2014) vs. US - 5.9% (Sep. 2014)
14% US-CA CA US
12%
10%
8%
6%
4%
2%
0%
-2%
-4%
SERIES: Unemployment Rate
SOURCE: US Bureau of Labor Statistics, CA Employment Development Division

EMPLOYMENT GROWTH, CA VS. U.S.
4 California US
2
0
-2
-4
-6
-8
SERIES: Total Nonfarm Employment

JOB LOSSES IN PRIOR RECESSIONS
RECENT CYCLE WORST BY FAR

ALERT: ALIENS ARE TAKING THE JOBS OF AMERICANS!
• They work long hours without complaint.
• They are happy with low pay.
• They don’t care about working conditions.
• They aren’t interested in joining unions.
• Who are they?
Source: U.C.L.A. Ed Leamer

CALIFORNIA JOB CHANGES BY INDUSTRY
September 2014: CA +2.3%, +390,600
-1.7%
-2.2%
-0.3%
1.5%
1.5%
1.4%
1.3%
0.9%
2.3%
2.1%
3.3%
5.3%
4.9%
4.7%
6.2%
-3% -2% -1% 0% 1% 2% 3% 4% 5% 6% 7%
Construction
Admistrative & Support & Waste Services
Information
Professional, Scientific & Technical Services
Health Care & Social Assistance
Leisure & Hospitality
Real Estate & Rental & Leasing
Transportation, Warehousing & Utilities
Retail Trade
Wholesale Trade
Educational Services
Durable Goods
Government
Finance & Insurance
Nondurable Goods
SERIES: Total Nonfarm Employment By Industry

JOB TRENDS BY CALIFORNIA METRO AREA
September 2014: CA +2.3%, +390,600
1.3%
1.1%
2.1%
2.0%
1.9%
1.8%
1.7%
2.0%
2.5%
2.5%
3.7%
3.5%
San Francisco
San Jose
San Diego
Fresno MSA
Sacramento
Oakland
Ventura
Orange…
Los Angeles
Bakersfield
Stockton MSA
Modesto
0.0% 0.5% 1.0% 1.5% 2.0% 2.5% 3.0% 3.5% 4.0%
SERIES: Total Nonfarm Employment
SOURCE: CA Employment Development Division

CONSUMER PRICE INDEX
September 2014: All Items +1.7% YTY; Core +1.7% YTY
6% All Items Core
5%
4%
3%
2%
1%
0%
-1%
-2%
-3%
SERIES: Consumer Price Index
SOURCE: US Bureau of Labor Statistics

CONFIDENCE: UNEVEN TRENDING UP
October 2014: 94.5
INDEX, 100=1985
120
100
80
60
40
20
0
SERIES: Consumer Confidence
SOURCE: The Conference Board

MORTGAGE RATES + 1% SPRING 2013
ACTUAL TAPERING? WHAT IMPACT?
8% FRM ARM Federal Funds
7%
6%
5%
4%
3%
2%
1%
0%
SERIES: 30Yr FRM, 1Yr ARM, Federal Funds
SOURCE: Federal Home Loan Mortgage Corporation

0%
1%
2%
3%
4%
5%
6%
2009/01
2009/04
2009/07
2009/10
2010/01
2010/04
2010/07
2010/10
2011/01
2011/04
2011/07
2011/10
2012/01
2012/04
2012/07
2012/10
2013/01
2013/04
2013/07
2013/10
2014/01
2014/04
2014/07
8.28.14
9.18.14
FRM
ARM
MORTGAGE RATES HAVE NOT RISEN -YET
January 2009 – October 2014
MONTHLY WEEKLY
SERIES: 30Yr FRM, 1Yr ARM
SOURCE: Federal Home Loan Mortgage Corporation

U.S. DEPOSITORY INSTITUTIONS:
HIGH LEVEL OF EXCESS RESERVES SINCE 9/08
$ BILLIONS
$3,000
$2,500
$2,000
$1,500
$1,000
$500
$0
SERIES: Excess Reserves of Depository Institutions
SOURCE: Federal Reserve Bank of Saint Louis

FORECASTERS HAVE BEEN
EXPECTING RATES TO RISE
Percent
6
5
4
3
2
1
0
6
5
4
3
2
1
0
Actual 10-year Treasury yield (solid black line)
Predictions out to five quarters ahead of professional forecasters (hatched lines)
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
Percent
SERIES: Loan Officer Survey
SOURCE: Philadelphia Federal Reserve Survey of Professional Forecasters, Bloomberg

U.S. ECONOMIC FORECAST
Gross Domestic Product
Nonfarm Job Growth
Unemployment Rate
Consumer Price Index
Real Disposable Income,
%Change
2011
1.8%
1.2%
8.9%
3.1%
1.3%
2012
2.8%
1.7%
8.1%
2.1%
1.5%
2013
1.9%
1.7%
7.4%
1.5%
0.7%
2014 P
2.2%
1.8%
6.2%
2.0%
2.6%
2015 F
3.0%
2.2%
5.8%
2.2%
2.6%
SERIES: U.S. Economic Outlook
SOURCE: CALIFORNIA ASSOCIATION OF REALTORS®

CALIFORNIA ECONOMIC FORECAST
Nonfarm Job Growth
Unemployment Rate
Population Growth
Real Disposable Income,
%Change
2011
1.1%
11.8%
0.7%
1.9%
SERIES: CA Economic Outlook
2012
2.4%
10.4%
0.7%
1.1%
2013
3.0%
8.9%
0.9%
0.9%
2014 P
2.2%
7.5%
0.9%
3.0%
2015 F
2.4%
6.7%
0.9%
3.8%

CALIFORNIA HOUSING
MARKET OUTLOOK

TODAY’S MARKET
• Clearly well on the road to recovering - Bay Area
strongest regional market; Upper end most active
• Volume – Down, still reliant on investment sales
• Prices gains slowing in most markets
• Inventory remains tight but better than last year
• Pent-up/unrealized demand not yet translating into sales
• Affordability challenges emerging once again…

CA SALES FLAT FOR LAST 5 MONTHS
California, Oct. 2014 Sales: 396,220 Units, -8.8% YTD, -1.9% YTY
700,000
600,000
500,000
400,000
300,000
200,000
100,000
-
*Sales are SERIES: Sales of Existing Single Family Homes seasonally adjusted and annualized

MULTIPLE OFFERS DECLINE WITH LESS
INTENSE MARKET COMPETITION
AFTER PEAKING IN 2013
72%
53%
5.7
4.3
7
6
5
4
3
2
1
0
80%
70%
60%
50%
40%
30%
20%
10%
0%
% with Multiple Offers # of Multiple offers (Average)
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
SERIES: 2014 Housing Market Survey

49 % SOLD BELOW ASKING IN 2014
11%
7%
28%
54%
0% 20% 40% 60%
Less than 5%
5% to 9.99%
10% to 19.99%
20% or more
% of Price Reduction
(Properties Sold Below Asking Price)
Sale Price to Asking Price
Below Asking Price At Asking Price Above Asking Price
49%
18%
33%
Median Reduction:
4.5% of List Price

FEWER HOMES SOLD ABOVE THE ASKING PRICE
MARKET COMPETITION COOLED IN 2014
50%
33%
60%
50%
40%
30%
20%
10%
0%
% of Sales above Asking Price
Long Run Average = 19%
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
16
14
12
10
8
6
4
2
0
10%
9%
8%
7%
6%
5%
4%
3%
2%
1%
0%
Median Price Discount & Weeks on Market
Med. Price Discount
Med. Weeks on MLS
0%, 2.1
weeks
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
QUESTION: What was the original list sales price of the property? What was the final sales price of the property? How many
weeks did the property remain on the MLS?

INVESTMENT BUYERS DROPPING :
15% MARKET SHARE
19%
15%
20%
18%
16%
14%
12%
10%
8%
6%
4%
2%
0%
Long Run Average: 12 %
1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

BUYING TO RENT V. FLIP; CHANGE IN
PREFERRED INVESTMENT STRATEGY
Investment to Flip
Rental Property

WE’VE COME A LONG WAY SINCE 2009:
EQUITY SALES: 9 OUT OF 10 TRANSACTIONS
91.0%
0%
10%
4.6%
4.0%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Jan-09
Apr-09
Jul-09
Oct-09
Jan-10
Apr-10
Jul-10
Oct-10
Jan-11
Apr-11
Jul-11
Oct-11
Jan-12
Apr-12
Jul-12
Oct-12
Jan-13
Apr-13
Jul-13
Oct-13
Jan-14
Apr-14
Jul-14
Equity Sales Short Sale REO
SERIES: Distressed Sales, Not Seasonally Adjusted

SALES GROWING IN UPPER PRICE RANGES
Year-over-Year % Chg. in Sales Sep-14
-22.9%
-0.7%
-2.9%
40%
30%
20%
10%
0%
-10%
-20%
SERIES: Sales of Existing Detached Homes
4.9% 5.9%
2.8%
18.5%
28.3%
-30%

CHANGE IN SALES BY PRICE RANGE
(Year-to-Year)
9.0%
4.9%
-0.7%
-2.9%
-22.9%
70%
60%
50%
40%
30%
20%
10%
0%
-10%
-20%
-30%
-40%
-50%
-60%
$0 - $200k $500k+ $200 - $300k $300 - $400k $400 - $500k
SERIES: Sales of Existing Detached Homes

CA MEDIAN PRICE GAINS SLOWING
California, Oct. 2014: $450,620, Up 5.4% YTY
$700,000 P: May-07
$600,000
$500,000
$400,000
$300,000
$200,000
$100,000
$-
$594,530
T: Feb-09
$245,230
-59% from
peak
SERIES: Median Price of Existing Single Family Homes

PRICE GAINS HAVE MODERATED SINCE MID 2013
YTY% Chg. in Price
50% Condo Single-Family Homes
40%
30%
20%
10%
0%
-10%
-20%
-30%
-40%
-50%
SERIES: Sales of SFH and Condo Units

REO & SHORT SALES: SO CAL
Percent of Total Sales; Sep 2014
2%
1%
REO Sales Short Sales
4%
6%
2%
6%
3%
5%
5%
3%
14%
12%
10%
8%
6%
4%
2%
0%
Los Angeles Orange Riverside San Bernardino San Diego
SERIES: Distressed Sales, Not Seasonally Adjusted

LOS ANGELES COUNTY
Preforeclosure: 5,210 • Auction: 4,788 • Bank Owned: 1,015
SOURCE: PropertyRadar on 11/13/14

LA CANADA FLINTRIDGE
Preforeclosure: 19 • Auction: 8 • Bank Owned: 0

GLENDALE

LA CRESCENTA

CA PRICES UPWARD MARCH WILL SLOW
$600,000 California US
$500,000
$400,000
$300,000
$200,000
$100,000
$-
1970-2014
SERIES: Median Price of Existing Single Family Homes

INVENTORY IMPROVING FROM LAST YEAR
Sept 2013: 3.6 Months; Sept 2014: 4.2 Months
18
16
14
12
10
8
6
4
2
0
Note: “Unsold Inventory Index” represents the number of months it would take to sell the remaining inventory for the month in question. The
remaining inventory for the month is defined as the number of properties that were “Active”, “Pending”, and “Contingent” (when available) and
divide the sum by the number of “Sold” properties for the month in question.
SERIES: Unsold Inventory Index of Existing Single Family Homes

INVENTORY MOSTLY HIGHER
Price Range (Thousand) Oct-14 Sep-14 Oct-13
$1,000K+ 4.9 5.5 5.3
$750-999K 3.7 4.3 3.5
$500-749K 3.8 3.9 3.2
$400-499K 3.6 3.9 3.1
$300-399K 3.6 4.1 3.1
$200-299K 3.8 4.0 3.2
$0-199K 3.5 3.9 3.0
Note: “Unsold Inventory Index” represents the number of months it would take to sell the remaining inventory for the month in question. The
remaining inventory for the month is defined as the number of properties that were “Active”, “Pending”, and “Contingent” (when available) and
divide the sum by the number of “Sold” properties for the month in question.
SERIES: Unsold Inventory Index of Existing Single Family Homes

HOUSING AFFORDABILITY DOWN
SHARPLY SINCE Q1 2012
California vs. U.S. – 1984-2014
% OF HOUSEHOLDS THAT CAN BUY
A MEDIAN-PRICED HOME
80% CA US
70%
60%
50%
40%
30%
20%
10%
0%
SERIES: Housing Affordability Index of Traditional Buyers
Annual Quarterly

INCOME REQUIRED TO BUY A MEDIAN-PRICED
HOME IN CA: (PEAK VS. CURRENT)
$56,324
$93,593
$100,000
$80,000
$60,000
$40,000
$20,000
$0
2012 Q1 2014 Q2
• Change in minimum required income:
$37,269
• Increase in income attributed to
interest rate increase:
$836 (2.2% of total change)
• Increase in income attributed to price
increase :
$36,433 (97.8% of total change)
SERIES: Housing Affordability Index

HOMEOWNERSHIP RATE LOWER IN CA
California Vs. U.S.
75% CA US
70%
65%
60%
55%
50%
45%
40%
SERIES: Homeownership Rates
SOURCE: U.S. Census Bureau

HOMEOWNERSHIP RATE BY AGE OF
HOUSEHOLDER
SOURCE: Census Bureau

STUDENT DEBT: DRAGS ON HOME SALES

CA PERMITS UP BUT MORE UNITS NEEDED
2013: 57,496 Units, Up 43.0% from 2012
350000 Single Family Multi-Family
300000
250000
200000
150000
100000
50000
0
SERIES: New Housing Permits
SOURCE: Construction Industry Research Board
Household Growth: 220,000-250,000/yr

SALES OF RESIDENTIAL HOMES
Los Angeles County, October 2014: 4,052 Units
Up 6.0% MTM, Up 4.2% YTY
SOURCE: Clarus Market Metrics

MEDIAN PRICE OF RESIDENTIAL HOMES
Los Angeles County, October 2014: $435,000
Up 1.2% MTM, Up 6.1% YTY

FOR SALE PROPERTIES
Los Angeles County, October 2014: 18,135 Units
Down 3.7% MTM, Down 2.6% YTY
Note: “For Sale Properties” represents the overall supply that exist throughout the entire month, including any listings that appear as “Active” any
point in time during the month.

MONTH’S SUPPLY OF INVENTORY
• Los Angeles County, October 2014: 2.5 Months
Note: “Month’s Supply of Inventory” represents the number of months it would take to sell the remaining inventory for the month in question. The
remaining inventory for the month is defined as the number of properties that were “For Sale” on the last day of the month in question. The inventory
figure is then divided by the number of properties that went Under Contract during the month.

La Cañada, October 2014: 15
Up 36.4% MTM, Down 6.3% YTY
SOURCE: ClarusMarket Metrics

La Cañada, October 2014: $1,688,888
Up 30.9% MTM, Up 35.7% YTY

FOR SALE PROPERTIES
La Cañada, October 2014: 80 Units
Up 3.9% MTM, Down 23.1% YTY

La Cañada, October 2014: 1.4 Months

Pasadena, October 2014: 81 Units

Pasadena, October 2014: $655,000
Down 7.7% MTM, Up 4.0% YTY

FOR SALE PROPERTIES
Pasadena, October 2014: 355 Units

Pasadena, October 2014: 2.3Months

La Crescenta, October 2014: 17 Units

La Crescenta, October 2014: $599,000

FOR SALE PROPERTIES
La Crescenta, October 2014: 65 Units

La Crescenta, October 2014: 1.5 Months

CALIFORNIA HOUSING MARKET FORECAST
SFH Resales (000s)
% Change
Median Price ($000s)
% Change
Housing Affordability Index
30-Yr FRM
2011
422.6
1.4%
$286.0
-6.2%
53%
4.5%
SERIES: CA Housing Market Outlook
2012
439.8
4.1%
$319.3
11.6%
51%
3.7%
2013
413.3
-5.8%
$407.2
27.5%
36%
4.0%
2014 P
380.5
-8.2%
$455.0
11.8%
30%
4.3%
2015 F
402.5
5.8%
$478.7
5.2%
27%
4.5%

CALIFORNIA HOUSING MARKET OUTLOOK
Sales Down for 2014 but will Improve in 2015; Price Gains
Slowing
Units
(Thousand)
380 403
700
600
500
400
300
200
100
0
2005 2007 2009 2011 2013 2015f
Thousands
Sales of Existing Detached Homes
$479
$455
$600
$500
$400
$300
$200
$100
$0
2005 2007 2009 2011 2013 2015f
Thousands
Median Price
Price
(Thousand)

CA: DOLLAR VOLUME UP FOR 4THYEAR
Up 2.7% in 2014, Up 11.3% in 2015
$ in Billion % Change
$301
$244
$164
$ Volume of Sales Percent Change
-60%
$133 $131 $127 $121
$140
$169 $173
$193
30%
20%
10%
0%
-10%
-20%
-30%
-40%
$400
$350
$300
$250
$200
$150
$100
$50
$0
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014p 2015f

WHERE ARE ALL THE
FIRST-TIME BUYERS?

SHARE OF FIRST-TIME BUYERS UP
BUT STILL BELOW LONG-RUN AVERAGE
28.1%
30.5%
50%
40%
30%
20%
10%
0%
% First-Time Home Buyers Long Run Average
Long Run Average = 38%
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
QUESTION: Was the buyer a first-time buyer?

AVERAGE AGE OF BUYERS RISING
40 41 41 41
44
Average Age
41 40
38 37 36 35
38
48
60
50
40
30
20
10
0
2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
Q. What is your age?

SHARE OF YOUNGER BUYERS DOWN
Under 25 25-34 35-44 45-54 55-64 65+ Refused
100%
80%
60%
40%
20%
0%
2010
2011
2012
2013
2014
SERIES: 2014 Home Buyer Survey
Q. What is your age?

CA BUYERS: MINORITIES THE MAJORITY
White 36%
Hispanic 26%
Asian/Pacific
Islander 26%
Black 12%
Q. How would you describe your ethnic background?

WHY BUY NOW?
Price decreases
Promotion/raise
Low interest rates
Favorable price/financing
Desired better/other location
Investment/Tax advantage
Desired larger home
Long term appreciation
Change in family
9%
8%
17%
16%
15%
13%
34%
29%
54%
Q. What were your main reasons for buying your home?

BUYERS DIDN’T PURCHASE SOONER BECAUSE…
57% • Not many good housing options
53% • Waited to see when prices would stabilize
36% • No real buying urgency
30% • Difficulty qualifying for mortgage
21% • Needed to sell existing home
20% • Needed to save for down payment
15% • Waited until finances improved
Q. Why didn’t you buy a home sooner?

RENTERS: POTENTIAL
HOME OWNERS?

REASONS FOR RENTING INSTEAD OF BUYING
44%
9%
6%
6%
6%
5%
5%
3%
2%
Can't afford to buy
Poor credit / Can't qualify
Renting is easier
Young/Starting out/Not ready
Flexibility/Freedom if renting
Cost/Upkeep/Responsibility
Plan to / Saving for down
Never considered it/No interest
Disabled/On disability
SERIES: 2013 Renter Survey
Q. Why do you rent instead of buying?

RENTERS EXPECT TO BUY A HOME IN THE
FUTURE
don’t know
Q. Do you expect to buy a home in the future?
yes
52%
no
31%
17%

REASONS FOR NOT PLANNING TO BUY A HOME
41%
14%
7%
6%
6%
3%
3%
2%
Can't Afford to Buy
Prefer to Rent
Economic Uncertainty
Lack of Down Payment
Renting is Less Expensive
Job Uncertainty
Don't Know
Housing Market Uncertainty
Q. Why don’t you expect to buy a home in the future?

INTERNATIONAL BUYERS
MAKE THEIR MARK

1/3 FROM CHINA
4.7%
3.8%
8.3%
14%
China/Hong Kong
Canada
Mexico
Japan
India
Please tell us about your last closed transaction with an international client. What is your client’s country of permanent residence?
35%
0.0% 5.0% 10.0% 15.0% 20.0% 25.0% 30.0% 35.0% 40.0%

WHY THE UNITED STATES?
8.2%
6.6%
17.2%
21.3%
26.2%
0% 5% 10% 15% 20% 25% 30%
Employment
To be closer to friends and family
Location and climate
Investment potential
Safety and security
Why did your last international buyer choose to purchase in the U.S. as opposed to the other countries he/she/they considered?

OTHER COUNTRIES CONSIDERED
Singapore
Germany
China
Mexico
Canada
Sweden
France
In which other countries did your last international buyer consider purchasing real estate?

WHY INTERNATIONAL CLIENTS BUY
5%
5%
5%
7%
12%
14%
18%
0% 5% 10% 15% 20%
Investment/tax advantages
in U.S.
To rent out property
Changed jobs/relocated
Desired a better/other
location
Affordable price
Tired of renting
Investment to acquire legal
permenant U.S. resident…
What was your clients’ main reason for buying/selling now in your last closed transaction with an international client?

WHY U.S. CLIENTS BUY
10.0%
9.0%
7.0%
7.0%
12.0%
38.0%
0% 5% 10% 15% 20% 25% 30% 35% 40%
Price decreases
Favorable price/financing
Desired better/other location
Investment/Tax advantage
Tired of renting
Promotion/raise
What was your clients’ main reason for buying/selling now in your last closed transaction with an international client?

INTENDED USE FOR PROPERTY?
7%
2%
4%
30%
27%
38%
0%
91%
0% 20% 40% 60% 80% 100%
Primary Residence
Investment/Rental Property
Vacation/Second Home
Other
US Buyer
International Buyer
What was the intended use of the property in your last closed transaction with an international client?

ALL CASH INTERNATIONAL BUYERS
100%
80%
60%
40%
20%
0%
All cash Obtained financing
31%
69%
73%
27%
International buyers Traditional buyers
SOURCE: 2013 International Client Survey, 2013 Annual Housing Market Survey
How did your last international buyer pay for the property?

MILLENNIALS:
TOMORROW’S HOME
OWNERS?

NEARLY 2/5 MILLENNIALS STILL
LIVE WITH THEIR PARENTS
45%
40%
35%
30%
25%
20%
15%
10%
5%
0%
I rent I live with my
parents
What is your current living situation?
I own I live in a dorm Other:
41%
36%
20%
1%
1%
SERIES: 2014 Millennials Survey

MAJORITY RENT BECAUSE THEY
CAN’T AFFORD TO BUY
Can't afford to buy
Not ready to buy
It's easier to rent
Don't have a down payment
Can't qualify for a mortgage
Too costly to maintain property as owner
Enjoy the flexibility/freedom of renting
Don't have a job
Don't want the responsibility of owning
No interest in buying
Believe housing market will decline in the near future
Why do you rent instead of buying?
4%
2%
20%
17%
16%
10%
9%
7%
15%
24%
37%
67%
0% 10% 20% 30% 40% 50% 60% 70% 80%
Other

½ HAVE STUDENT DEBT
25%
20%
15%
10%
5%
0%
21%
12% 12%
$1-10K $10K-20K $20K-50K $50K-100K >$100K
What is the balance of your outstanding student debt?
3%
2%
Student Debt (In Thousands)

MOST EXPECT TO BUY A HOME WITHIN 5 YEARS
35%
30%
25%
20%
15%
10%
5%
0%
Within a
year
In 1-3
years
When do you expect to buy a home?
In 3-5
years
When I
get
married
When I
have a
child
Never Other Don't
know
18-26
27-34
All

MILLENNIALS’ BIGGEST CONCERNS
Price/Affordability (45%)
Problems with Credit, Mortgages, or Taxes (19%)
Maintenance/Upkeep (14%)
Satisfaction with Home/Location (7%)
Responsibility (4%)
What are your biggest concerns about home ownership?

MOST MILLENNIALS UNCERTAIN/DOUBTFUL
THAT THEY COULD OBTAIN A MORTGAGE
NOW?AMILLENNIAL ETHNICITY
SOURCE: C.A.R. 2014 Millennial Survey
Q: Could you obtain a mortgage if you applied now ?
Yes 22%
No 33%
Don't know
45%

PEOPLE WOULD PREFER THE FOLLOWING OVER
GOING THROUGH THE HOME MORTGAGE PROCESS
AGAIN:
SOURCE: Guaranteed Rate Mortgage Survey of 1,000 adults 25 and older USA Today April 2014

THANK YOU!
www.car.org/marketdata
lesliea@car.org

Partners Trust La Cañada Grand Opening: 2014-2015 California Economic Outlook presented by Leslie Appleton-Young, Chief Economist of the California Association of Realtors®

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