SelectRe Boston Report for 4 Quarter 2014

1. 4Q 2014 Quarterly Viewpoint Boston Condos and Single Family Homes DASHBOARD year-on-year AVERAGE SALES PRICE CLOSED SALES LISTING DISCOUNT BID / ASK RATE DAYS ON MARKET %Δ 0.6% - - - - %Δ 9.9% (9.7%) 0.5% 4% 7 Days Year-to-Date Average Sales Price Closed Sales Listing Discount Bid / Ask Rate Days on Market (DOM)  Average prices jumped, sales volume decreased, listing discounts flat, days on market rose.  Full price offers and bidding wars grew YOY. 4Q14 $669,725 5,124 1.0% 55% 87 3Q14 $665,756 3,966 0.7% 56% 86 4Q13 $609,531 5,678 1.5% 51% 94 9.9% 5,124  1.0%  55%  87  MACRO DATA CONSUMER PRICE INDEX S&P/CASE-SHILLER BOSTON® FHFA PURCHASE INDEX BOSTON UNEMPLOYMENT RATE BOSTON AFFORDABILITY INDEX PRICE TO FAMILY INCOME RATIO 30 YR MORTGAGE 5/1 YR ARM LEADING INDICATORS 236.2  175.0  261.8  4.3%  125.3  4.6 3.77% 3.11% The Boston housing recovery continued as lower sales volumes, shrinking listing discounts and lower days on market pushed average sales prices higher. Housing inventory continues to be scarce, and thus the price trend remains up. Buyers bid up Boston prices with more than half of all sales going for equal or above asking price as measured by the Bid/Ask Rate. Mid- Rise, 2-3 Family and Rowhouse styles were in the highest demand. Look. There is no doubt that home prices have gotten ahead of economic fundamentals. Wages are flat and many job seekers are can't find decent work. Things certainly don't feel normal. But low interest rates coupled with supply and demand imbalances will continue to push prices higher in the months ahead in our view. Household formations also picked up dramatically. From the chart above, you can see that 4Q14 household formations were the highest since 2012, and the most recent reading of 2,001,000 new households was the highest since before the financial crisis. So not all Millennials are moving in with their parents. In fact, the data shows household formation growth can still occur despite Census Bureau reports that the percentage of young adults living their parents has climbed. This is simply a function of the law of large numbers. Put simply, the Millennial generation is so large that the actual number of young adults not living with their parents will lift housing demand. At present, this most evident in local rent inflation. With Boston's Unemployment Rate falling from 5.5% to 4.3% and the 52.2  82.1  5.1%  117.8  2,001M ARCHITECTURE BILLING INDEX PENDING HOME SALES INDEX MORTGAGE APPLICATIONS MORTGAGE CREDIT AVAILABILY INDEX HOUSEHOLD FORMATIONS For more information, questions or comments about this report, please email the author, Ron Quint at RonQuint@sreboston.com. Please also contact Ron Quint at (617) 838-9976 if you're interested in a obtaining a comprehensive market analysis for your home. SelectRE Boston is full-service real estate brokerage firm that caters to the urban Boston market, providing a high level of service to clients in both luxury rentals and sales. Ron Quint Real Estate Advisor Licensed Agent Sources: Federal Reserve Board, S&P/Case Schiller, Federal Housing Finance Agency, Bureau of Labor Statistics, National Association of Realtors, Mortgage Bankers Association, US Census, American Institute of Architects, and Multiple Listing Service. The information contained in this report is based on a statistical sample gathered from third party sources and is intended for informational purposes only. SelectRE and its author make no representations as to the accuracy or reliability of the information and disclaim any liability caused by error or omission. A change or withdrawal of information may be made without notice. This report may not be reproduced without prior consent of SelectRE and its author.

2. 4Q 2014 Quarterly Viewpoint Mortgage Credit Availability Index increasing from 116.1 to 117.3, the Boston residential real estate market is poised for sustained price growth. Moreover, according to the Mortgage Bankers Association, there are several lending initiatives aimed at making mortgages more available and affordable. More credit availability for home buyers is bullish for home prices. By the most recent count, the S&P/Case- Shiller Boston Home Price Index rose to 175.0 at 4Q14 near its peak of 182.5 at 2Q05. Likewise, the FHFA Purchase Index, a repeat-sales index that measures average price changes, rose to 261.8 at 4Q14 near its peak of 276.1 at 3Q05. Despite strong home price gains, the Boston Home Affordability Index improved from 130.7 to 125.3 due to lower interest rates. The Architecture Billings Index (ABI) ended 2014 on a positive note as well, as business conditions remained strong. Overall, the ABI was positive 10 out of 12 months in 2014 (any score over 50 indicates billings growth), and thus business conditions at architecture firms were generally positive all year. While most strength in the index is associated with the commercial sector, the ABI signals continued economic growth, which is a tailwind for residential housing. But there are a number of headwinds to consider as well. Strong household formation will encourage builders to break ground on new projects and motivate home sellers to join the festivities. Ultimately, this will help improve housing inventory, and put a lid on price growth as supply grows. Another headwind is that home affordability is still elusive to many buyers and most buyers still deal with stringent lending standards. Home prices have also once again advanced considerably faster than incomes, breaking out of their 3.4 to 3.6 historical range of price to family income (based on $145,800 dual median family income). Perhaps this is why new mortgage applications slipped by 5.1% YOY, suggesting that some potential buyers have remained on the sidelines. Notwithstanding, improved buyer demand pushed pending home sales to its highest level since August 2013, according to the National Association of Realtors. The Northeast Pending Home Sales Index (PHSI), a forward-looking indicator based on contract signings, inched up from 82.1 to 84.9, and is now up 6.9% from a year ago. Thus demand remains strong. On a final note, the US dollar has now entered a secular bull market amidst economic chaos aboard. This will encourage wealthy foreign buyers to seek refuge in US assets, particularly luxury real estate. As a result, some high-end Boston neighborhoods may decouple from the local economy. Brookline is urban city with a rural freedom. The city's picturesque neighborhoods are served by top notch public schools, a profusion of amenities, and expansive cultural outlets. Brookline's proximity to Boston makes it a "can't miss" location. Residents of Brookline are as diverse as the city itself. Families, singles, and students are integrated into various villages, squares, and neighborhoods throughout the city. Brookline is generally considered affluent. Boylston Street/Route 9 divides the town into two broad sections: North Brookline and South Brookline or “NoBro” and “SoBro.” North Brookline neighborhoods include Aspinwall Hill, Beaconsfield, Brookline Hills, Brookline Village, Cleveland Circle, Corey Hill, Cottage Farm, Fisher Hill, Longwood, Saint Marys, the Heights, and Washington Brookline BY PROPERTY TYPE 45% of SFH sold above asking price. 65% of Condos sold above asking price. BY PRICE Square. Brookline High School, the majority of the elementary and middle schools, most retail shops, Coolidge Corner and the Main Brookline Public Library are located in North Brookline. The streetscapes of Brookline Village, Coolidge Corner, Cleveland Circle, Saint Mary's, and Washington Square all share the C-line tracks and are shaped by classic brick mansard-roofed row houses with continuous cornice lines that create a unified vista along Higher price gains seen in Condos in percentage terms. Highest price gains seen in SFHs valued above $1.3 million in both percentage and absolute dollar terms. BY NEIGHBORHOOD Strongest average price increases seen in Chestnut Hill and Coolidge Corner.

3. Beacon St. Beaux Arts Classicism and Second Empire architecture abound here, and ambitious decorative appointments can be found inside and out of residences. The most grandiose examples include sculptures, carvings, decorative ironwork, classical columns, balustrades, and other details often executed to a high degree of finish. Much of the South End and Back Bay was built up in a similar fashion. Here a 2 bedroom condo will cost you $500,000 to $1,500,000, depending on the size and condition. Aspinwall Hill covers the area bordered by Beacon St., Washington St., Greenough St., the D-line tracks, and Regent Circle. The area was settled in the late 1800's, when Dr. William Aspinwall bought land on what is now Aspinwall Hill. The only other house on the Hill up to the 1880's was the house built by Lewis Tappan in the late 1820s. Tudor, Colonial, and Georgian style single family homes are commonly found in this area. A starting budget of $1,500,000 is appropriate. Defined by Longwood Ave., Huntington Ave., and The Riverway, Longwood was once a part of a planned residential development of David Sears. Though he and his family spent only half the year in Brookline, David Sears purchased land for his family and friends on the present day Longwood in the early 1800's, following the construction of the Mill Dam Road which connected Boston with Brookline. The current day Longwood is within walking distance to the Longwood Medical Area (LMA), making the area a magnet for medical professionals who flock here. Condos dominant the LMA and range in style and price. For example, an 800 sq. ft. unit may run you $500,000, whereas a larger unit can easily put you out a $1 million or more. The LMA is adjacent to the Fenway/Kenmore, Audubon Circle and Mission Hill neighborhoods, which present other housing options in Boston. Nearby Longwood is "Cottage Farm," a small Brookline enclave that borders Beacon St., St. Paul St., Carlton St., and Worthington St. Cottage Farm is listed on the State and National Registers of Historic Places, and is officially designated as a Brookline Local Historic District. The area was first developed in the 1850’s when Beacon St. became an extension of Mill Dam Road. The design and character of Cottage Farm can be traced back to Amos and William Lawrence, who foresaw the increase in demand that would occur with an improved commute to Boston. The name "Cottage Farm" derives from the English Cottage style, which is most often associated with a lifestyle of genteel country living. Most of the homes date back to the early 1900’s, and outstanding examples of Gothic Revival architecture can be found here. Amos Lawrence's house at 135 Ivy St. illustrates this style best. A single family home here will likely run you $2,500,000 while Condos start at $650,000. The price for convenience! Close by Corey Hill lays claim to one of the best views that the greater Boston area has to offer. This area of Brookline is located off of Washington Square near Summit Avenue. Here you will find a quaint and quiet park that serves as a sanctuary to Brookline residents and visitors alike. Single family homes start at $1,000,000 and move up to $1,300,000. Condos generally start in the $600,000's. Brookline Hills, an area at intersection of Cypress St. and Tappan St., is best known for being the home to Brookline High School. There is a mix home style in this area from Colonial to Victorian styles. Albeit Condos are more common and generally start in the $650,000's. Newbury College is located at the top of Fisher Hill, where some of the largest Brookline estates lie. The neighborhood is named after Francis Fisher who built his estate on the corner of Boylston St. and Chestnut Hill Ave. in the early 1850's. Fisher Hill is listed on the National Register Historic Districts, and its boundaries generally run along Fisher Ave. The majority of homes here are single-family dwellings that climb into the multi-million dollar price range. Property taxes on a single family Fisher Hill home can be significant, reaching up to $18,000 per annum. Beaconsfield covers the area bordered by Rawson Rd., Fisher Ave., Beacon St., and Boylston St. A variety of single family homes and condominiums can be found here, ranging from the $500,000 to $1,800,000. Washington Square and Fisher Hill are both in close proximity as well as C and D Lines. South Brookline is better known for its beautiful homes and green space, offering the quiet of the suburbs. Characterized by rolling green hills, grand estates, and extensive conservation land, South Brookline is most popular among families. Some of the better known areas in South Brookline include Putterham Circle, Pill Hill, Larz Anderson, Buttonwood Village, Corey Farm, the Point, and Chestnut Hill. Here you will find many neighborhoods with their own distinctive culture, architecture and amenities. Home styles run the gamut from simple ranches to exquisite European influenced style homes. Pill Hill, a small residential area that borders Walnut St., Pond Ave., and Cypress St., is a small section of SoBro in close proximity to the Longwood Medical Area. The area is often populated by doctors and medical professionals, and has an active park advocacy group that regularly hosts community social events as well as neighborhood clean-ups. Most homes were built in the early 20th century with beautiful examples of Victorian architecture. Nearby Leverett Pond, Downes Field and the surrounding area of Olmstead Park are treasured by Pine Hill residents, providing excellent recreational access. But you'll need more than a mortgage to score digs here with single family home prices often hitting the $3,000,000 mark. Located between Chestnut Hill and Jamaica Plain, Buttonwood Village is often considered a more affordable area for young families and professionals. Single family Colonial homes built in the 1950’s are the most common home style here, and start in the $650,000’s. Nearby Allendale Farm, Boston’s last colonial working farm, offers residents and visitors fresh local produce to chew on. While

4. nearby Larz Anderson Park offers residents great recreational facilities, including athletic fields, picnic areas, and a skating rink. Putterham is located between Buttonwood Village and Chestnut Hill at the intersection of Grove St. and West Roxbury Parkway. The intersection of the two streets create a small rotary, where the Shops at Putterham are located, a popular destination for local residents. Putterham marks its place in history with the Putterham School, a single- room school house that dates back to over 200 years ago. But today, Putterham is best known for its two golf courses, including the Robert T. Lynch at Putterham Meadows and The Country Club. The golf course at Putterham Meadows is a beautiful 18-hole public course, while The Country Club is a private course that often hosts many world famous golf tournaments. Like Buttonwood Village, single family homes around Putterham can found at a more affordable price as compared to "Nobro," starting in the mid $700,000s. Finally, Chestnut Hill is unique in that it encompasses parts of three municipalities: Boston, Brookline, and Newton. There is a peaceful serenity to the neighborhoods in Chestnut Hill that are populated with Tudor and Colonial style homes. In contrast, the area turns decidedly commercial along Boylston Street. Here most single family homes generally start above $1 million. However, modest single family homes in need of TLC can be fetched in the $700,000's to $800,000's. SelectRE Boston 295 East Street Hingham, MA 02043 (617) 777-6109 www.sreboston.com Equal Housing Opportunity.