LETTER FROM THE PRESIDENT

In uncertain economic times like we are currently experiencing, it is sometimes hard to stay focused on the personal principles and goals we have set for ourselves. Not a day goes by where the press and the media pound into our heads the impending doom and gloom of a recession and continuing drop in housing prices. One advantage of being in the housing industry for over thirty-five years is I’ve experienced multiple cycles where home values rose and fell. In the late 70’s and early 80’s the prime interest rate hit 21 ½ % and the so called pundits were predicting the deflation of the housing market for many years to come. The same market adjustments occurred in the early 90's and in 2001 after 9/11. Now after banner home appreciation years in 2003, 2004, and 2005 where the same media and press were highlighting the front pages of our local newspapers with Sarasota county leading the nation with 34% and 36% home appreciation, this same group of so called experts would have you think that your home will have no value whatsoever in a few more years! The reality and lesson to be learned is as follows: huge price swings and adjustments in housing values is not the norm; they are anomalies. Those markets that experienced the greatest short term appreciation will usually experience the greatest market correction. If you are an investor in short term buying and selling of real estate then those are the inherent risks you incur. If however you are a first or second home buyer, which the majority of our buyers are, then short term cycles should not cloud your goals. Real estate, in specific your primary residence, has always been the largest single investment that Americans make in their lifetime. The return on investment has been excellent over the long run. All you have to do is remember the very first home you bought. Mine was $27,500 in 1974! We all have stories about our first purchase of real estate and I would venture to say that we all feel that it was the best financial decision we ever made. Yes we are in a market correction and yes home values are downward in the short term. But rest assured that as the inventory of homes gets absorbed and the credit markets adjust from the sub prime fiasco the next cycle of home appreciation will begin. Well built homes in good locations reasonably priced will always be good investments. Premier Communities was founded on this philosophy and will not waiver on our goals and principles.

Sincerely, Mark G. Botts President Premier Communities