Meritage Homes Reports Increases in Sales, Gross Profit and Net Operating Results for the Third Quarter of 2009



 THIRD QUARTER 2009 SELECTED RESULTS:
  -- Increased net sales orders to 1,098 homes, reporting the
     Company's first quarterly year-over-year increase and lowest
     cancellation rate since the housing downturn began in 2006
  -- Narrowed net loss to $0.56 per share from $4.69 loss per share
     in 2008, with 76% lower impairments
  -- Improved gross profit margin excluding impairments to 14.5% --
     its highest level in eight quarters -- over 12.3% in the prior
     quarter and 12.7% in the prior year
  -- Managed overhead costs to reduce general and administrative
     expenses by 31% from prior year

 YEAR TO DATE 2009 SELECTED RESULTS:
  -- Cut net loss position by nearly half due to cost controls and
     lower impairments
  -- Decreased inventory of unsold homes to 2.5 per community and
     maintained 3.1 years supply of lots (based on ttm closings)
     while replacing older lots with new lower-priced lots
  -- Reduced net debt/capital ratio to 35% after retiring $24M debt
     and increasing cash by $160M

SCOTTSDALE, Ariz., Oct. 26, 2009 (GLOBE NEWSWIRE) -- Meritage Homes Corporation (NYSE:MTH), a leading U.S. homebuilder, today announced third quarter results for the period ended September 30, 2009.



                Summary Operating Results (unaudited)
           (Dollars in millions, except per share amounts)
 ----------------------------------------------------------------------
                              Three Months Ended    Nine months Ended
                                  September 30,       September 30,
                              2009    2008   %Chg   2009    2008   %Chg
 ----------------------------------------------------------------------
 Homes closed (units)         1,015   1,423  -29%   2,837   4,139  -31%
 Home closing revenue        $  232  $  373  -38%  $  683  $1,118  -39%
 ----------------------------------------------------------------------
 Sales orders (units)         1,098   1,013    8%   3,232   4,120  -22%
 Sales order value           $  254  $  254    0%  $  750  $1,061  -29%
 ----------------------------------------------------------------------
 Ending backlog (units)                             1,676   2,269  -26%
 Ending backlog value                              $  405  $  613  -34%
 ----------------------------------------------------------------------
 Net loss (including
  write-offs)                $  (18) $ (144)  88%  $ (110) $ (213)  48%
 Adjusted pre-tax loss*
  (excluding write-offs)     $   (4) $   (7)  32%  $  (17) $  (12) -43%
 Diluted EPS (including
  write-offs)                $(0.56) $(4.69)  88%  $(3.52) $(7.37)  52%
 ----------------------------------------------------------------------
 * Adjusted pre-tax loss excludes impairments: See non-GAAP
   reconciliations of net loss to adjusted pre-tax loss on "Operating
   Results" statement
 ----------------------------------------------------------------------

THIRD QUARTER OPERATING RESULTS

Meritage reported a net loss for the third quarter of 2009 of $18 million or $0.56 per share, compared to a net loss of $144 million or $4.69 per share in the third quarter of 2008. The improved results in 2009 benefited from lower pre-tax real estate-related impairment charges of $13 million in 2009, compared to $55 million of similar charges in 2008. Excluding these charges, the pre-tax losses from operations were $4 million in the third quarter of 2009 and $7 million in the third quarter of 2008. Additionally, the 2008 net loss included a $106 million charge for a deferred tax asset valuation allowance.

Third quarter home closing revenue declined 38% year over year, due to 29% fewer homes closed, coupled with a 13% lower average closing price of approximately $228,000 in the third quarter of 2009, compared to approximately $262,000 in the third quarter of 2008. The lower average closing price reflects general market declines, in addition to Meritage's new series of more affordable homes, designed to appeal to first time and first move-up home buyers. Sales of homes to entry level and first move-up buyers represented about two-thirds of the Company's third quarter 2009 sales.

The Company's gross profit margin excluding impairment charges reached its highest level in the last eight quarters, climbing to 14.5% from 12.3% in the prior quarter and 12.7% in the prior year's third quarter. Net of impairments, gross margins were 9.9% for the third quarter of 2009 and -1.7% for the third quarter of 2008.

"We've significantly improved our gross margins despite pricing pressures by designing efficient homes that offer our buyers tremendous value, reducing our construction costs, and building communities in highly desirable locations. We have driven down our average construction costs by 30-40% in many of our markets, allowing us to offer lower prices while also improving our profitability per home," said Steven J. Hilton, chairman and chief executive officer of Meritage Homes. "Our newer communities, where we are building these homes on lower-cost lots, are achieving higher margins and selling at a faster pace than most of our older communities. As we close out those older communities and our new communities become a larger component of our total sales, we expect to return to more normal margins and profitability."

By continuing its focus on tight control of overhead costs, Meritage also reduced its general and administrative expenses by 31%, to $14 million in the third quarter of 2009, from $21 million in the previous year. Commissions and other sales costs were 46% lower in 2009 than 2008, greater than the 38% decline in home closing revenue, due to lower marketing and advertising costs from regionalizing these functions, and lower model operating costs from owning fewer models.

Meritage reported positive earnings before interest, taxes, depreciation and impairments (adjusted EBITDA -- see "Non-GAAP Financial Disclosures" statement) of $11 million, a 7% increase over the third quarter of 2008. The Company has reported positive adjusted EBITDA every quarter throughout the housing recession.

YEAR TO DATE OPERATING RESULTS

Meritage reported a net loss for the first nine months of 2009 of $110 million or $3.52 per share, compared to a net loss of $213 million or $7.37 per share in the first nine months of 2008. The 2009 net loss included $90 million year to date in pre-tax real estate-related impairment charges and a $3 million write-off of capitalized fees related to the reduction and ultimate termination of the Company's credit facility, partially offset by a $9 million gain on extinguishment of debt. The 2008 year to date loss included $154 million of pre-tax real estate-related impairment charges, a $10 million benefit from a legal settlement in the second quarter, and the deferred tax asset valuation allowance of $106 million.

Since the third quarter of 2008, the Company has fully reserved its deferred tax assets arising from its operating losses. The cumulative deferred tax assets totaled $169 million as of September 30, 2009, which are available to offset federal income tax liability on an estimated $480 million of future taxable income.

SALES

Net orders showed the first quarterly year-over-year increase in the past 15 quarters, since the beginning of the downturn in the housing market. Net orders of 1,098 homes in the third quarter were 8% higher than the prior year's sales of 1,013 homes. The increase was driven by gains of 53% in California, 40% in Colorado and 176% in Florida, which together made up 23% of third quarter 2009 sales. These strong increases in some of the Company's hardest hit markets were muted by minor decreases in the Company's largest markets, as Texas sales were 2% lower and Arizona was 4% lower than the previous year.

The third quarter cancellation rate of 20% was the lowest for Meritage in more than four years. By comparison, after the financial crisis in September of 2008, the third quarter 2008 cancellation rate was 40%.

With 22% fewer active communities at September 30, 2009, the average sales per community increased to 6.5 for the third quarter 2009 from 4.8 in the same period last year. Management expects the sales pace to improve as more new communities are opened, and as its markets stabilize and improve.

Meritage's backlog of orders was 26% lower at the end of the third quarter of 2009 compared to 2008, but has grown successively over each of the last four quarters.

BALANCE SHEET

Meritage has generated nearly $500 million cash flow from operations over the last eight quarters, and increased cash by $247 million over the last twelve months, ending with $366 million in cash, cash equivalents and restricted cash as of September 30, 2009. The increase in cash helped the Company reduce its net debt/capital ratio to 35%, from 46% one year earlier, after also retiring $24 million in debt in the first nine months of 2009. The Company has redeployed a portion of its cash to replenish its supply of lots and replace older communities as they close, by acquiring finished lots in desirable locations at deeply discounted prices, often less than the cost of developing those lots. Unrestricted cash declined by $38 million during the third quarter, primarily due to the use of cash for new lot positions and a $19 million restricted cash balance established to secure outstanding letters of credit previously supported by the credit facility, which was terminated during the quarter.

"We are reinvesting in our future by acquiring lower-priced lots in locations where we have identified the best opportunities to sell our homes with the least risk from foreclosures, increasing home inventories, falling prices or other adverse market conditions," said Mr. Hilton. "During the quarter, we contracted for 2,500 lots in 11 communities within five states. This lot count includes approximately 1,300 lots in Province, an award-winning active adult community outside Phoenix that we put under contract during the quarter and closed in October.

"We are actively pursuing finished lot positions in most of our markets, and expect to acquire additional communities through the balance of the year," Mr. Hilton continued.

At September 30, 2009, Meritage's total 13,221 lots represented about 3.1 years lot supply based on trailing twelve months closings. That included 8,359 owned lots, 63% of the total. By comparison, the Company's total lot supply was 20,738, or 3.3 years supply at September 30, 2008, with 44% or 9,095 of those lots owned.

Meritage held 407 unsold homes in inventory at September 30, 2009, an average of 2.5 specs per community, compared to 809 or 3.9 specs per community one year earlier. The Company has been starting more homes before obtaining a sales contract as part of its strategy to have homes available for sales to first time home buyers and renters, but sales have outpaced starts, resulting in a net reduction in spec inventory during the year.

The Company has also reduced its average time from sale to close by approximately eight weeks since the beginning of 2008. By shortening cycle times from sale to close, Meritage should be able to build and deliver more homes without increasing the inventory on its balance sheet, thereby improving its returns on assets and invested capital.

STOCK EXCHANGED FOR DEBT

In the first nine months of 2009, Meritage retired a total of $24 million of its 7.731% senior subordinated notes due 2017 in exchange for 783,000 shares of Meritage Homes common stock at an implied discount of 41% to the face value of the notes retired, saving approximately two million dollars of future interest cost per year. This resulted in a $9 million gain on the early extinguishment of debt, included as a component of other income.

TERMINATED CREDIT FACILITY

Meritage terminated its credit facility at the end of the third quarter of 2009, as the Company did not anticipate needing the $150 million facility before the agreement was due to expire in May of 2011. The Company entered into three new commitments for letters of credit with an aggregate capacity of approximately $53 million, securing approximately $19 million in outstanding letters of credit previously supported by the credit facility, and providing additional capacity for future needs. The termination of the facility resulted in a non-cash charge in the third quarter of 2009 of approximately $800,000 to write off capitalized origination fees, and is expected to save the Company approximately $2 million in fees over the remaining life of the facility.

SUMMARY

"We have made excellent progress toward achieving our plan to return to profitability in 2010, and believe we will be profitable for the entire year, anticipating no material impairments as our markets stabilize and improve," said Mr. Hilton. "We have reduced our direct costs and overhead cost structure, redesigned homes and repositioned communities, allowing us to offer quality Meritage homes at very affordable and competitive prices. Based on our projections for the fourth quarter, we expect to generate positive cash flow from operations for the full year 2009, after cash used for lot acquisitions during the year, but before including the tax refunds of $108 million collected early this year.

"Because we are not saddled with heavy debt or long land positions, as some homebuilders are, we are able to use our strong financial position and shorter lot supply to restock our balance sheet with new lower-cost lots that are generating better margins."

Mr. Hilton continued, "I believe our market research is a competitive advantage that helps us make good decisions quickly as we evaluate lot acquisitions, product offerings and pricing. The intelligence provided by our research gives us confidence that we're acquiring lots in the right locations at the right price, both minimizing our risk and maximizing our upside potential."

He concluded, "I believe this is one of those times in history that can be a game-changer for many industries, and an opportunity to define who the next leaders will be. Meritage is well positioned and our organization is poised to make the most of our opportunities. I'm excited about the prospects for our future."

Management will host a conference call to discuss these results on October 27, 2009 at 11:00 a.m. Eastern Time (8:00 a.m. Pacific Time.) The call will be webcast by Business-to-Investor, Inc. (B2i), with an accompanying slideshow on the "Investor Relations" page of the Company's web site at http://investors.meritagehomes.com. For telephone participants, the dial-in number is 877-485-3104 with a passcode of "Meritage". Participants are encouraged to dial in five minutes before the call begins. A replay of the call will be available after 12:30 p.m. ET, October 27, 2009 on the website noted above, or by dialing 877-660-6853, and referencing passcode 334226.



             Meritage Homes Corporation and Subsidiaries
                          Operating Results
                             (Unaudited)
                (In thousands, except per share data)

                          Three Months Ended       Nine months Ended
                             September 30,           September 30,
                           2009        2008        2009        2008
                           ----        ----        ----        ----
 Operating results
 Home closing revenue   $  231,816  $  372,907  $  683,208  $1,118,486
 Land closing revenue           --       1,859       1,285       5,007
                        ----------  ----------  ----------  ----------
  Total closing revenue    231,816     374,766     684,493   1,123,493
 Home closing gross
  profit                    23,183       6,786       1,449      31,135
 Land closing gross loss      (281)    (13,050)       (450)    (19,616)
                        ----------  ----------  ----------  ----------
  Total closing gross
   profit/(loss)        $   22,902  $   (6,264) $      999  $   11,519

 Commissions and other
  sales costs              (18,382)    (33,840)    (55,625)   (101,274)
 General and
  administrative
  expenses(1)              (14,269)    (20,735)    (41,913)    (52,481)
 Interest expense           (8,853)     (5,835)    (28,515)    (17,034)
 Other income/(loss),
  net(2)                       963       5,092      17,252      (7,256)
                        ----------  ----------  ----------  ----------
 Loss before income
  taxes                    (17,639)    (61,582)   (107,802)   (166,526)
 Provision for income
  taxes                       (146)    (82,431)     (1,940)    (46,260)
                        ----------  ----------  ----------  ----------
 Net loss               $  (17,785) $ (144,013) $ (109,742) $ (212,786)
                        ==========  ==========  ==========  ==========

 Loss per share
 Basic and Diluted:
   Loss per share       $    (0.56) $    (4.69) $    (3.52) $    (7.37)
   Weighted average
    shares outstanding      31,718      30,690      31,197      28,872

 Non-GAAP
  Reconciliations:
 Total closing gross
  profit/(loss)         $   22,902  $   (6,264) $      999  $   11,519
 Add: Real estate-
  related impairments
   Terminated lot
    options and land
    sales                    3,505      19,342      66,219      44,939
   Impaired projects         7,130      34,670      21,264      88,564
                        ----------  ----------  ----------  ----------
 Adjusted closing gross
  profit                $   33,537  $   47,748  $   88,482  $  145,022
                        ==========  ==========  ==========  ==========
 Loss before income
  taxes                 $  (17,639) $  (61,582) $ (107,802) $ (166,526)
 Add: Real estate-
  related and joint
  venture (JV)
  impairments
   Terminated lot
    options and land
    sales                    3,505      19,342      66,219      44,939
   Impaired projects         7,130      34,670      21,264      88,564
   JV impairments            2,611       1,070       2,830      20,759
                        ----------  ----------  ----------  ----------
 Adjusted loss before
  income taxes          $   (4,393) $   (6,500) $  (17,489) $  (12,264)
                        ==========  ==========  ==========  ==========

 (1) General and administrative expenses for the nine months ended
     September 30, 2008 reflect a $10.2 million benefit related to a
     successful legal settlement.

 (2) Other income is net of the Joint Venture (JV) impairments shown
     in the "Non-GAAP reconciliations" section above. 2009 includes a
     gain on early extinguishment of debt of $9 million in the nine
     months ended September 30, 2009.


             Meritage Homes Corporation and Subsidiaries
                    Non-GAAP Financial Disclosures
                            (In thousands)
                              (unaudited)

                             Three Months Ended     Nine months Ended
                                September 30,         September 30,
                              2009        2008      2009        2008
                              ----        ----      ----        ----

 EBITDA reconciliation:(1)
 Net loss                   $ (17,785) $(144,013) $(109,742) $(212,786)
  Provision/(benefit) for
   income taxes                   146     82,431      1,940     46,260
  Interest amortized to cost
   of sales and interest
   expense                     12,891     13,068     44,440     40,836
  Depreciation and
  amortization                  2,002      3,221      6,547      9,785
                            ---------  ---------  ---------  ---------
  EBITDA                    $  (2,746) $ (45,293) $ (56,815) $(115,905)

  Add back:
  Real estate-related
   impairments                 13,246     55,082     90,313    154,262
  Fixed asset impairments          --         --         --         --
  Goodwill and intangible
   asset impairments               --         --         --         --
                            ---------  ---------  ---------  ---------
  Adjusted EBITDA           $  10,500  $   9,789  $  33,498  $  38,357
                            =========  =========  =========  =========

                                                   As of and for the
                                                  Twelve Months Ended
                                                     September 30,
                                                   2009        2008
                                                   ----        ----

 EBITDA reconciliation:(1)
 Net loss                                       $ (188,891) $ (341,625)
  Provision/(benefit) for income taxes             (28,351)    (22,380)
  Interest amortized to cost of sales and
   interest expense                                 63,222      59,185
  Depreciation and amortization                     12,431      14,147
                                                ----------  ----------
  EBITDA                                        $ (141,589) $ (290,673)

  Add back:
  Real estate-related impairments                  199,491     283,787
  Fixed asset impairments                               --       3,124
  Goodwill and intangible asset impairments          1,133      57,538
                                                ----------  ----------
  Adjusted EBITDA                               $   59,035  $   53,776
                                                ==========  ==========

 Interest coverage ratio:(2)
  Adjusted EBITDA                               $   59,035  $   53,776
  Interest incurred                                 48,109      52,648
  Interest coverage ratio                              1.2         1.0

 Net debt-to-capital:(3)
   Notes payable and other borrowings           $  604,968  $  629,718
   Less: cash, cash equivalents and restricted
    cash                                          (365,555)   (119,027)
                                                ----------  ----------
  Net debt                                         239,413     510,691
  Stockholders' equity                             440,559     604,891
                                                ----------  ----------
  Capital                                       $  679,972  $1,115,582
  Net debt-to-capital                                 35.2%       45.8%


 (1) EBITDA and adjusted EBITDA are non-GAAP financial measures
 representing net earnings /(loss) before interest amortized to cost
 of sales and interest expense, income taxes, depreciation and
 amortization, with write-offs and non-cash impairment charges also
 excluded from adjusted EBITDA. A non-GAAP financial measure is a
 numerical measure of a company's historical or future financial
 performance, financial position or cash flows that excludes amounts,
 or is subject to adjustments that have the effect of excluding
 amounts, that are included in the most directly comparable measure
 calculated and presented in accordance with GAAP in the statement of
 operations, balance sheet, or statement of cash flows (or equivalent
 statements) of the Company; or includes amounts, or is subject to
 adjustments that have the effect of including amounts, that are
 excluded from the most directly comparable measure so calculated and
 presented. In this regard, GAAP refers to generally accepted
 accounting principles in the United States. We have provided a
 reconciliation of these non-GAAP financial measures to the most
 directly comparable GAAP financial measure. EBITDA is presented here
 because it is used by management to analyze and compare Meritage with
 other homebuilding companies on the basis of operating performance
 and we believe it is a financial measure widely used by investors and
 analysts in the homebuilding industry. EBITDA as presented may not be
 comparable to similarly titled measures reported by other companies
 because not all companies calculate EBITDA in an identical manner
 and, therefore, it is not necessarily an accurate means of comparison
 between companies. EBITDA is not intended to represent cash flows for
 the period or funds available for management's discretionary use nor
 has it been presented as an alternative to operating income or as an
 indicator of operating performance and it should not be considered in
 isolation or as a substitute for measures of performance prepared in
 accordance with GAAP. Adjusted EBITDA is presented because it more
 closely, although not exactly, resembles the comparable covenant
 calculations under our senior and senior subordinated note
 indentures.

 (2) Interest coverage ratio is calculated as the trailing four
 quarters' adjusted EBITDA divided by the trailing four quarters'
 interest incurred.

 (3) Net debt-to-capital is calculated as notes payable and other
 borrowings less cash, cash equivalents and restricted cash, divided
 by the sum of notes payable and other borrowings, less cash, cash
 equivalents and restricted cash, plus stockholders' equity.


             Meritage Homes Corporation and Subsidiaries
                Condensed Consolidated Balance Sheets
                            (In thousands)
                             (unaudited)

                                          September 30,   December 31,
                                              2009           2008
                                          -------------  -------------
 Assets:
  Cash and cash equivalents               $     346,951  $     205,923
  Restricted Cash                                18,604             --
  Income tax receivable                           2,125        111,508
  Other receivables                              27,063         31,046
  Real estate(1)                                718,438        859,305
  Investments in unconsolidated entities         12,311         17,288
  Option deposits                                12,309         51,658
  Other assets                                   45,838         49,521
                                          -------------  -------------
   Total assets                           $   1,183,639  $   1,326,249
                                          =============  =============

 Liabilities:
  Senior notes                            $     479,093  $     478,968
  Senior subordinated notes                     125,875        150,000
  Revolving credit facility                          --             --
  Accounts payable, accrued liabilities,
   home sale deposits and other
   liabilities                                  138,112        170,075
                                          -------------  -------------
   Total liabilities                            743,080        799,043
  Total stockholders' equity                    440,559        527,206
                                          -------------  -------------
   Total liabilities and equity           $   1,183,639  $   1,326,249
                                          =============  =============

  (1) Real estate - Allocated costs:
     Homes under contract under
      construction                        $     191,699  $     170,347
     Unsold homes, completed and under
      construction                               67,917        158,378
     Model homes                                 37,552         48,608
     Finished home sites and home sites
      under development                        364,716        455,048
     Land held for development or sale          56,554         26,924
                                          -------------  -------------
       Total allocated costs              $     718,438  $     859,305
                                          =============  =============


             Meritage Homes Corporation and Subsidiaries
            Condensed Consolidated Statement of Cash Flows
                            (In thousands)
                             (unaudited)

                             Three Months Ended     Nine months Ended
                                September 30,         September 30,
                              2009        2008      2009        2008
                              ----        ----      ----        ----

 Operating results

 Net loss                   $ (17,785) $(144,013) $(109,742) $(212,786)
 Real-estate related
  impairments                  10,635     54,012     87,483    133,503
 Decrease in deferred taxes        --     10,519         --      1,496
 Deferred tax valuation
  allowance                        --    106,225         --    106,225
 Equity in (losses)/earnings
  from JVs (including
  impairments) and
  distributions of JV
  earnings, net                 2,335      1,041      3,991     22,020
 (Increase)/decrease in real
  estate and deposits, net    (15,353)    14,572     94,720     95,818
 (Increase)/decrease in
  income tax receivable           (87)     2,391    107,573     80,543
 Other operating activities      (565)   (40,351)   (26,591)  (120,667)
                            ---------  ---------  ---------  ---------
 Net cash (used in)/provided
  by operating activities     (20,820)     4,396    157,434    106,152
                            ---------  ---------  ---------  ---------

 Cash used in investing
  activities                  (19,169)      (644)   (20,669)   (16,479)
                            ---------  ---------  ---------  ---------

 Net repayments under Credit
  Facility                         --         --         --    (82,000)
 Proceeds from issuance of
  common stock, net                --         --         --     82,775
 Other financing activities     1,630        122      4,263        902
                            ---------  ---------  ---------  ---------
 Net cash provided by
  financing activities          1,630        122      4,263      1,677
                            ---------  ---------  ---------  ---------

 Net (decrease)/increase in
  cash                        (38,359)     3,874    141,028     91,350
 Beginning cash and cash
  equivalents                 385,310    115,153    205,923     27,677
                            ---------  ---------  ---------  ---------
 Ending cash and cash
  equivalents               $ 346,951  $ 119,027  $ 346,951  $ 119,027
                            =========  =========  =========  =========


             Meritage Homes Corporation and Subsidiaries
                            Operating Data
                        (Dollars in thousands)
                             (unaudited)

                                       For the Three Months Ended
                                            September 30,
                                       2009                2008
                                ------------------  ------------------
                                  Homes     Value     Homes     Value
                                  -----     -----     -----     -----
 Homes Closed:
  California                          62  $ 20,319       131  $ 52,530
  Nevada                              33     6,635        71    19,057
                                --------  --------  --------  --------
  West Region                         95    26,954       202    71,587

  Arizona                            213    38,617       297    75,226
  Texas                              611   142,697       783   186,023
  Colorado                            36    10,932        37    13,342
                                --------  --------  --------  --------
  Central Region                     860   192,246     1,117   274,591

  Florida                             60    12,616       104    26,729
                                --------  --------  --------  --------
  East Region                         60    12,616       104    26,729
                                --------  --------  --------  --------
  Total                            1,015  $231,816     1,423  $372,907
                                ========  ========  ========  ========

 Homes Ordered:
  California                         130  $ 40,483        85  $ 32,768
  Nevada                              33     6,637        41    11,780
                                --------  --------  --------  --------
  West Region                        163    47,120       126    44,548

  Arizona                            212    40,490       220    49,314
  Texas                              597   134,948       609   145,463
  Colorado                            35    10,342        25     7,943
                                --------  --------  --------  --------
  Central Region                     844   185,780       854   202,720

  Florida                             91    21,447        33     7,113
                                --------  --------  --------  --------
  East Region                         91    21,447        33     7,113
                                --------  --------  --------  --------
  Total                            1,098  $254,347     1,013  $254,381
                                ========  ========  ========  ========


             Meritage Homes Corporation and Subsidiaries
                            Operating Data
                        (Dollars in thousands)
                             (unaudited)

                               For the Nine months Ended September 30,
                                     2009                 2008
                              -------------------  -------------------
                               Homes      Value     Homes      Value
                               -----      -----     -----      -----
 Homes Closed:
  California                      218  $   76,042      456  $  187,357
  Nevada                          112      23,724      205      55,174
                              -------  ----------  -------  ----------
  West Region                     330      99,766      661     242,531

  Arizona                         563     111,063      772     205,094
  Texas                         1,679     403,535    2,311     560,634
  Colorado                        105      33,002      101      35,323
                              -------  ----------  -------  ----------
  Central Region                2,347     547,600    3,184     801,051

  Florida                         160      35,842      294      74,904
                              -------  ----------  -------  ----------
  East Region                     160      35,842      294      74,904
                              -------  ----------  -------  ----------

  Total                         2,837  $  683,208    4,139  $1,118,486
                              =======  ==========  =======  ==========

 Homes Ordered:
  California                      287  $   93,688      451  $  177,913
  Nevada                           99      19,549      193      50,833
                              -------  ----------  -------  ----------
  West Region                     386     113,237      644     228,746

  Arizona                         621     119,295      765     170,216
  Texas                         1,899     431,725    2,410     581,280
  Colorado                        107      32,910      102      35,493
                              -------  ----------  -------  ----------
  Central Region                2,627     583,930    3,277     786,989

  Florida                         219      52,796      199      45,659
                              -------  ----------  -------  ----------
  East Region                     219      52,796      199      45,659
                              -------  ----------  -------  ----------
  Total                         3,232  $  749,963    4,120  $1,061,394
                              =======  ==========  =======  ==========

 Order Backlog:
  California                      156  $   51,556      159  $   72,088
  Nevada                           12       2,278       52      14,319
                              -------  ----------  -------  ----------
  West Region                     168      53,834      211      86,407

  Arizona                         248      50,443      383      85,680
  Texas                         1,107     258,345    1,571     404,997
  Colorado                         46      13,173       54      18,307
                              -------  ----------  -------  ----------
  Central Region                1,401     321,961    2,008     508,984

  Florida                         107      28,991       50      17,502
                              -------  ----------  -------  ----------
  East Region                     107      28,991       50      17,502
                              -------  ----------  -------  ----------

  Total                         1,676  $  404,786    2,269  $  612,893
                              =======  ==========  =======  ==========


             Meritage Homes Corporation and Subsidiaries
                            Operating Data
                             (unaudited)

                                Three Months Ended  Three Months Ended
                                September 30, 2009  September 30, 2008
                                ------------------  ------------------
                                  Beg.       End      Beg.       End
                                  ----       ---      ----       ---
 Active Communities:
  California                          12         9        17        15
  Nevada                              12         6        12        12
                                --------  --------  --------  --------
  West Region                         24        15        29        27

  Arizona                             31        28        31        30
  Texas                              108       102       136       132
  Colorado                             4         3         5         5
                                --------  --------  --------  --------
  Central Region                     143       133       172       167

  Florida                             11        14        12        13
                                --------  --------  --------  --------
  East Region                         11        14        12        13

                                --------  --------  --------  --------
  Total                              178       162       213       207
                                ========  ========  ========  ========

                                 Nine Months Ended   Nine Months Ended
                                September 30, 2009  September 30, 2008
                                ------------------  ------------------
                                  Beg.       End      Beg.       End
                                  ----       ---      ----       ---
 Active Communities:
  California                          12         9        27        15
  Nevada                              12         6        11        12
                                --------  --------  --------  --------
  West Region                         24        15        38        27

  Arizona                             31        28        36        30
  Texas                              109       102       127       132
  Colorado                             3         3         6         5
                                --------  --------  --------  --------
  Central Region                     143       133       169       167

  Florida                             11        14        13        13
                                --------  --------  --------  --------
  East Region                         11        14        13        13

                                --------  --------  --------  --------
  Total                              178       162       220       207
                                ========  ========  ========  ========

About Meritage Homes Corporation

Meritage Homes Corporation is a leading designer and builder of single-family detached homes in the historically high-growth southern and western United States. We offer a variety of homes that are designed to appeal to a wide range of homebuyers, including first-time, move-up, luxury and active adult buyers, with base prices ranging from under $100,000 to a million dollars. As of September 30, 2009, we had 162 actively selling communities in 12 metropolitan areas including Houston, Dallas/Ft. Worth, Austin, San Antonio, Phoenix/Scottsdale, Tucson, Las Vegas, Denver, Orlando, and the East Bay/Central Valley and Inland Empire of California. Meritage Homes and its predecessor companies have delivered over 60,000 homes since the Company was founded, including more than 5,600 homes delivered in 2008. Meritage ranks as the 9th largest homebuilder in the U.S. based on homes closed.

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This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements include those regarding Meritage's expectations of generating positive cash flow from operations for the full year 2009; returning to profitability in 2010 and being profitable for the entire year; improving the pace of sales per community as new communities are opened, and as markets stabilize and improve; and continuing to acquire additional communities through the balance of 2009. Such statements are based upon the current beliefs and expectations of Company management and current market conditions, which are subject to significant risks and uncertainties as set forth in our Form 10-K for the year ended December 31, 2008 under the caption "Risk Factors," and updated in our subsequent Quarterly Reports on Form 10-Q. As a result of these and other factors, actual results may differ from those set forth in the forward-looking statements and the Company's stock and note prices may fluctuate dramatically. The Company makes no commitment, and disclaims any duty, to update or revise any forward-looking statements to reflect future events or changes in these expectations.

CONTACT:  Meritage Homes Corporation
          Investor Relations:
          Brent Anderson, Vice President-Investor Relations
            (972) 580-6360
          Corporate Communications:
          Jane Hays, Vice President-Corporate Communications
            (972) 580-6353