M.D.C. Holdings, Inc. September 2018 Investor Presentation The - PowerPoint PPT Presentation

M.D.C. Holdings, Inc. September 2018 Investor Presentation The Citrine, AZ

Forw ard Looking Statements Certain statements in this presentation, including statements regarding our business, financial Soho, CO condition, results of operation, cash flows, strategies and prospects, constitute "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause the actual results, performance or achievements of MDC to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. Such factors include, among other things, (1) general economic conditions, including changes in consumer confidence, inflation or deflation and employment levels; (2) changes in business conditions experienced by MDC, including cancellation rates, net home orders, home gross margins, land and home values and subdivision counts; (3) changes in interest rates, mortgage lending programs and the availability of credit; (4) changes in the market value of MDC’s investments in marketable securities; (5) uncertainty in the mortgage lending industry, including repurchase requirements associated with HomeAmerican Mortgage Corporation’s sale of mortgage loans (6) the relative stability of debt and equity markets; (7) competition; (8) the availability and cost of land and other raw materials used by MDC in its homebuilding operations; (9) the availability and cost of performance bonds and insurance covering risks associated with our business; (10) shortages and the cost of labor; (11) weather related slowdowns and natural disasters; (12) slow growth initiatives; (13) building moratoria; Bedford, UT (14) governmental regulation, including the interpretation of tax, labor and environmental laws; (15) terrorist acts and other acts of war; (16) changes in energy prices; and (17) other factors over which MDC has little or no control. Additional information about the risks and uncertainties applicable to MDC's business is contained in the Company’s Annual Report on form 10-Q for the quarter ended June 30, 2018. All forward-looking statements made in this presentation are made as of the date hereof, and the risk that actual results will differ materially from expectations expressed in this press release will increase with the passage of time. The Company undertakes no duty to update any forward-looking statements, whether as a result of new information, future events or otherwise. However, any further disclosures made on related subjects in our subsequent filings, releases or presentations should be consulted. It should also be noted that SEC Regulation G requires that certain information accompany the use of non-GAAP financial measures. Any information required by Regulation G will be posted on our web site, www.mdcholdings.com.

Company Overview Founded in 1972, M.D.C. Holdings, Inc. is one of the leading homebuilders in the United States. Through our Richmond American Homes subsidiaries, we’ve helped over 195,000 buyers move into new, quality homes across the country. Homebuilding Operations: Seattle Portland (Coming Soon) Northern California Financial Services Business Units: Metro Maryland Salt Lake Denver City Las Vegas Northern Virginia Colorado Springs Southern California Phoenix Tucson Jacksonville Orlando South Florida AZ CA NV WA CO UT FL Mid-Atl Total LTM Deliveries 791 916 921 379 1,576 222 466 388 5,659 % of Total 14.0% 16.2% 16.3% 6.7% 27.8% 3.9% 8.2% 6.9% LTM ASP ('000s) $ 333 $ 646 $ 366 $535 $ 496 $459 $ 370 $ 504 $ 468 Data as of quarter ended June 30, 2018 3

The MDC Difference How MDC is Different How MDC is Different Why it Matters Why it Matters Led By Two of the Industry’s Most Senior Veterans Decades of experience has created long-term shareholder value by successfully navigating through CEO/COO with 87 years of combined experience at MDC  multiple economic cycles (ranked #1) vs. 42-year average for peer group Industry-Leading Management Ownership Aligns management’s interests with our shareholders  CEO/COO beneficial ownership of 26% (ranked #1) of MDC shares vs. 5% average for peer group Conservative Inventory Strategies Limit Risk Inline with Company operating philosophy, emphasizing  Carefully managed land supply designed to reduce exposure to industry cycles risk management and financial stability while striving to achieve long-term shareholder value “Build-to-order” policy limits risk vs. speculative building  of unsold homes by peer group Commitment to maintaining a strong financial profile (1) Credit Profile Among the Best in the Industry safeguards against inevitable market downturns and (2)  Moody’s: Ba2 / S&P: BB+ / Fitch: BBB- provides capital resources for opportunistic investments Industry-Leading Dividend (ranked #1)  Current yield of 3.7% vs. 0.4% average for peer group*  Uninterrupted cash dividend since 1994 – unequalled by Shows long-term commitment and ability to provide a any member of the peer group reliable source of return for our shareholders  In the past ten years, Company paid approximately $500 million in dividends to shareholders * Dividend yield from Yahoo Finance, September 14, 2018 Peer group includes: Beazer Homes (BZH), D.R. Horton (DHI), Hovnanian Enterprises, Inc. (HOV), KB Home (KBH), Lennar (LEN), M/I Homes Inc. (MHO), Meritage Homes Corporation (MTH), NVR, Inc. (NVR), PulteGroup (PHM), and Toll Brothers (TOL). 4

Creating A Sustainable Builder Operation Across Cycles  Conservative operating philosophy that minimizes land speculation, which improves returns over the entire housing cycle and reduces our risk and exposure to land price volatility No land banking, no joint ventures, and minimal goodwill   Generally target 2-3 year land supply  Significant portion of owned lots are finished (58% at June 30, 2018) -- minimal additional investment required before start of home construction  No “mothballed” communities  Focus on presales, with 89% of work-in-process units already sold as of June 30, 2018  Approach is becoming more unique for MDC as more homebuilders move to a spec strategy Strong merchandising and “Home Gallery” operations focus on customization niche within production  builder environment  Strict underwriting criteria and management discipline  Allows us to grow over the long run and retain prudent cash positions in order to weather the cyclicality of the housing industry 5

Overview – Q2 2018 vs. Q2 2017 • Net income of $63.9 million, or $1.12 per diluted share • Dollar value of net new orders up 9% year-over-year to vs. $33.9 million, or $0.60 per diluted share* $776.2 million – Monthly sales absorption pace up 8% to 3.68 • Pretax income of $76.6 million increased 48% vs. $51.9 million • Ending backlog of $1.95 billion, up 16% • Home sale revenues increased 16% to $749.6 million • 3,678 lots approved for purchase, up 10% • Gross margin from home sales up 230 basis points to • Liquidity increased 18% to $1.14 billion 19.1% • Paid dividend of $0.30 per share, up 30% *All per share amounts have been adjusted as necessary for the 8% stock dividend declared and paid in the 2017 fourth quarter. The Deacon, AZ (RV Series) Yorktown, UT 6

Forw ard-Looking Guidance* • Backlog dollar value at June 30, 2018 up 16% year- • Targeting a 10% year-over-year increase in active over-year to $1.95 billion subdivision count by year end (from 151 at 12/31/2017 to at least 166 at 12/31/2018) – Gross margin from home sales in backlog at 6/30/2018 roughly even with 2018 second quarter closing gross margin of 19.1% • Lots controlled of 23,626 at 6/30/2018, up 38% – Backlog conversion ratio (home deliveries year-over-year divided by beginning backlog) for Q3 2018 estimated to be in the 40% to 41% range • Estimated effective tax rate for the final six months of 2018 between 25% and 27%, excluding impact of • Active subdivision count at 6/30/2018 of 164 up 7% any further discrete items year-over-year *All guidance effective as of August 1, 2018 The Grove, CA The Yorktown, CO Coronado, UT Yorktown, UT 7

YoY Change in Gross Margin % 230 bps 210 bps 170 bps 120 bps 120 bps 60 bps N/A* ‐20 bps ‐40 bps ‐40 bps ‐90 bps MDC DHI KBH HOV PHM MTH TOL BZH NVR MHO LEN Source: Company filings. Note: Figures as of most recent quarter or annual public filing. * LEN change omitted due to YoY impact on comparability as a result of the merger with CAA 8

Adjusted Gross Margin from Home Sales* 30% 28.4% 27.7% 28% 26% YTD June ‘18 up 220 24.1% bps YoY from YTD 24% 23.2% 23.0% June ‘17 22.3% 22.2% 22% 19.3% 20% 19.0% 17.8% 18% 16.9% 16.7% 16.8% 17.1% 16.9% +870 bps 16.8% Proven ability to grow 15.5% 16% 13.9% 14.6% 14.5% gross margin quickly 14.0% 14% 11.7% 12% 10% 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 1H 2018 *Before impairments and warranty adjustments. See end of presentation for reconciliation of non-GAAP financial measures. 9

Product Spotlight - Seasons The Peridot, AZ The Coral, CO The Citrine, CO The Moonstone, FL Q2 2018 Activity 48% of total lots approved for acquisition / 48% of total lots acquired 10 19% of total homes sold / 13% of total homes delivered