The good news keeps getting better, and the signs arevery real — our country’s economic recovery is not amirage that will disappear before our eyes. Oureconomy has strengthened and our real estate marketis heating up. Because the key indicators have changedgradually over an expanded period of time, it hasn’talways been clear that we were headed in the rightdirection. Caught up in the daily news of stops andstarts, highs and lows, it’s been easy to lose sight ofwhere we were headed. But now we can see that theupturn is real — this is no mirage!

OUR REAL ESTATE MARKET

If your personal circumstances dictate a move… if youwant to buy a new home… if you want to sell yourhome, now is the time to move forward. For buyers andsellers, it’s important to push ahead. If you’ve beenholding off because of uncertainty or for “better”market conditions, consider this:

Affordability

Home buyers have more purchasing power than everbefore. The combination of low interest rates and homeprices make this a once-in-a-generation opportunity.

Favorable mortgage rates

Mortgage investors believe that this recovery isreal and that means there is only one way for ratesto go — up. We’ve seen rates creep up already in thepast several weeks. Though overall mortgage rates areprojected to remain low, they will not be as favorablein the future as they are now.

Growth in the number of sales

Pending sales in our marketplace have grown at apositive rate each month since April 2011. Andthrough March 2012, the number of pending sales isapproximately 20% over what they were in 2011,significantly exceeding our expectations.

A Message from Lawrence F. Flick, IV, Chairman and Chief Executive OfficerPrudential Fox & Roach, REALTORS®and The Trident Group

1

The Chairman’s Report

SPRING/SUMMER 2012 REGIONAL EDITION: NORTHERN DELAWARE

THIS IS NO MIRAGE

2

Level house prices

Though trends vary from community to community,house prices are at a point of stabilization. Moody’sAnalytics forecasts that prices are leveling out in 2012and 2013. Although prices have come down over thepast five years, housing has continued to be a solidlong-term investment.

THE ECONOMY

If you’ve read previous issues of my Chairman’s Report,you know I’ve been positive about the economy and ourreal estate market for the past two years. There was goodreason to be so. The economy was growing, and the realestate market in our region was more stable than in otherareas of the country. Then the economy struggled towithstand the effects of the Japanese tsunami, the Greekdebt crisis and the Arab Spring. These unexpectednon-local events fostered uncertainty and made bothbusinesses and consumers wary to move forward. But thesituation is different now. After nearly three years of slowyet steady growth, the economy has gained seriousmomentum. I believe there is enough traction now todeflect another unexpected event, including higher gasprices. All of the current indicators are strong:

Growing consumer confidence

Consumers are spending again. Their debt is moremanageable, and they feel better about their jobs. TheConference Board’s Consumer Index measuring currentconditions is at its highest level since 2008.

Strong manufacturing growth

It was manufacturing that kick-started our nationaleconomy’s upward trend. As economist Joel Naroff says,“The manufacturing sector is the rock on which therecovery is being built and the base is as stable as it gets.”

Rising employment

As more businesses begin to hire, the unemploymentrate has dropped, despite more job seekers enteringthe market.

Job growth is stronger than it has been in recent years.Between February 2011 and February 2012, theeconomy gained two million jobs. In the past threemonths, 734,000 jobs have been added. Comparethis to 2009, when the country was losing 750,000 jobsper month!

Recovering stock market

Though they still experience ups and downs,the Dow, NASDAQ and S&P have all madeconsiderable gains in the past two years.

WHY BUY NOW?

There hasn’t been a better time to buy a home in ageneration! The combination of low interest rates andleveling prices create a very real market conditionfavoring buyers. Though the rise in interest rates andhouse prices will not be dramatic, they will undoubtedlyrise. Therefore, if your circumstances warrant a change,you will want to benefit now from today’s positivetrends. Otherwise, you may look back in a year andrealize you missed your best purchasing opportunity.

WHY SELL NOW?

The best reason to sell now is to take advantage of thepent-up demand being unleashed as our economystrengthens. Many potential buyers had postponed their

search even though they wanted to make a move. Buttoday, these buyers are venturing beyond initial interest.They are setting up appointments, attending openhouses, and making offers! In fact, many of our salesassociates report that sellers whose houses are inexcellent condition and priced right are receivingmultiple offers. We haven’t seen that in quite a while.

THIS IS NO MIRAGE

What we are seeing is real — it’s clear — it’s no mirage.If you’ve wanted to move, now is the time. Don’t delay.Contact your Prudential Fox & Roach sales associateand your Trident mortgage consultant today!

3

What we are seeing is real — it’s clear — it’s no mirage.If you’ve wanted to move, now is the time.

After nearly three years of slow yet steady growth,the economy has gained serious momentum.

Lawrence F. Flick, IVChairman and Chief Executive OfficerPrudential Fox & Roach, Realtors® and The Trident Group

An independently owned and operated broker member of BRER Af'liates Inc. Prudential, the Prudential logo and theRock symbol are registered service marks of Prudential Financial, Inc. and its related entities, registered in manyjurisdictions worldwide. Used under license with no other af'liation of Prudential. Equal Housing Opportunity.4

AN INDEPENDENT VIEW

Joel L. Naroff, Ph.D., is thePresident and founder ofNaroff Economic Advisors.He is a consultant toPrudential Fox & Roach,Realtors and The TridentGroup. A nationallyrecognized economicforecasting expert, Joel wasawarded the Lawrence Klein

Award for Blue Chip forecasting excellence and was theBloomberg Business News top economic forecaster in2008. In 2007, he received the National Association ofBusiness Economists Outlook Award and was named thetop economic forecaster by MSNBC in 2006.

Both the national and regional economies arebeginning to pick up speed. Job growth has beenstrong with almost every type of business in allindustries adding workers. The falling unemployment

rate has generated renewed consumer optimism andspending is rising. While the surge in gasoline pricesis reducing household purchasing power, unlike 2008and 2011, the economy is strong enough to absorbthe hit without slowing sharply. The outlook is forthe economy to accelerate as we go through the restof the year.

The improving economic landscape has significantimplications for the housing market. Prices havestabilized and in many areas they are starting to rise,though slowly. At the same time, interest rates aremoving upward, reflecting the better businessconditions. The combination of higher mortgagerates and stable or even rising home values shouldcreate a change in the strategy of buyers. Once theyrecognize that both prices and interest costs are goingto increase, fence sitters will have to move morequickly. Given how affordable homes are currently,now would be a great time to get serious aboutpurchasing a home before the rising costs really beginto kick in.