Contacts:
<TABLE>
<CAPTION>
<S>                           <C>                                <C>
ARIZONA:                      TEXAS:                             NEW YORK:
Larry Seay                    Jane Hays                          Thomas Franco
CFO & Vice President/Finance  Vice President Corp. Development   Broadgate Consultants
(602) 998-8700                (972) 612-8085                     (212) 232-2222
</TABLE>

FOR IMMEDIATE RELEASE


                MERITAGE MANAGING DIRECTOR CLEVERLY TO STEP DOWN
           BILL CLEVERLY TO REMAIN BOARD MEMBER AND MAJOR SHAREHOLDER


         SCOTTSDALE,  ARIZONA  AND  DALLAS,  TEXAS  (MARCH 18,  1999) - MERITAGE
CORPORATION,  FORMERLY  MONTEREY HOMES  CORPORATION  (NYSE: MTH) today announced
that Bill Cleverly is stepping down as a Managing Director  effective today. Mr.
Cleverly will continue to serve the Company as a Board Member and Consultant and
continues  to hold  668,000  shares  of stock and  options  to  acquire  167,000
additional shares of stock.

         Going forward,  corporate leadership  responsibilities  will be divided
equally  between John R. Landon and Steven J. Hilton,  also Managing  Directors.
They will oversee strategy  development,  operating functions,  acquisition,  as
well as other corporate administrative activities.

         Mr. Hilton commented,  "As one of the founders of Meritage Corporation,
Bill has been closely  involved and  instrumental  with the Company's  sustained
growth and success.  Bill is a good friend and we wish him well.  We are pleased
that Bill will  continue  with the Company as a member of the Board of Directors
and significant shareholder."

         Mr. Cleverly said,  "For more than 14 years I have dedicated  myself to
growing  this Company into a strong and  profitable  competitor  within the home
building  industry.  I have had the  opportunity to participate in the Company's
growth and  expansion  and the time is right to utilize my talents to tackle new
challenges.  Meritage is in a very  healthy  position  and Steve and John have a
strong  platform  from which to lead the Company to its next level of profitable
growth."

                                     -more-
Bill Cleverly to Step Down as Managing Director/2

         Meritage   Corporation   designs,    builds   and   sells   distinctive
single-family  homes ranging from entry-level to semi-custom luxury. The Company
operates in the Phoenix and Tucson,  Arizona  markets  using the Monterey  Homes
brand name; in the Dallas/Ft. Worth, Austin and Houston, Texas markets as Legacy
Homes,  and in the San  Francisco  Bay and  Sacramento,  California  markets  as
Meritage Homes of Northern California.

         "SAFE HARBOR" STATEMENT UNDER THE PRIVATE SECURITIES  LITIGATION REFORM
ACT OF 1995:  ANY  STATEMENTS  SET FORTH ABOVE THAT ARE NOT HISTORICAL IN NATURE
ARE  FORWARD-LOOKING  STATEMENTS THAT INVOLVE RISKS AND UNCERTAINTIES THAT COULD
CAUSE  ACTUAL  RESULTS TO DIFFER  MATERIALLY  FROM THOSE IN THE  FORWARD-LOOKING
STATEMENTS.  FORWARD-LOOKING  STATEMENTS  ARE  INHERENTLY  SUBJECT  TO RISKS AND
UNCERTAINTIES,  SOME OF WHICH CANNOT BE PREDICTED OR QUANTIFIED. POTENTIAL RISKS
AND UNCERTAINTIES  INCLUDE SUCH FACTORS AS THE STRENGTH AND COMPETITIVE  PRICING
ENVIRONMENT OF THE SINGLE-FAMILY HOUSING MARKET, CHANGES IN THE AVAILABILITY AND
PRICING OF RESIDENTIAL  MORTGAGES,  CHANGES IN THE  AVAILABILITY  AND PRICING OF
REAL  ESTATE  IN THE  MARKETS  IN WHICH THE  COMPANY  OPERATES,  DEMAND  FOR AND
ACCEPTANCE  OF THE  COMPANY'S  PRODUCTS,  THE SUCCESS OF PLANNED  MARKETING  AND
PROMOTIONAL  CAMPAIGNS,  THE  SUCCESS  OF THE  COMPANY'S  PROGRAM  TO  INTEGRATE
EXISTING OPERATIONS WITH ADDITIONAL  ACQUISITIONS,  AND OTHER FACTORS IDENTIFIED
IN DOCUMENTS FILED BY THE COMPANY WITH THE SECURITIES AND EXCHANGE COMMISSION.


                                     # # # #