[ERNST & YOUNG LLP LETTERHEAD]



January 22, 1997




Securities and Exchange Commission
450 Fifth Street, N.W.
Washington, D.C. 20549

Gentlemen:

We have read Item 4 of Form 8K/A1  dated  January  22,  1997 of  Monterey  Homes
Corporation  (formerly  Homeplex  Mortgage  Investments  Corporation) and are in
agreement  with the  statements  contained  in the  second  paragraph  under the
heading "Changes in Registrant's  Certifying  Accountant" on page 3 therein.  We
have no basis to agree or  disagree  with  other  statements  of the  registrant
contained therein.


                                        /s/ Ernst & Young LLP

                                            Ernst & Young LLP