American Homestar Partners with The Home Depot to Provide Quality, Affordable Housing to the Gulf Coast.

HOUSTON -- American Homestar Corporation (Pink Sheets: AHMS) today announced a new initiative, with The Home Depot, to provide housing to the Gulf Coast markets affected by hurricanes in 2005. After Hurricanes Katrina and Rita, more than 250,000 homes were destroyed throughout the Gulf Coast, leaving nearly 800,000 people without a principal residence. Rebuilding efforts have been slow in many areas due, in part, to shortages of construction materials and skilled construction labor.

The Home Depot's Home Services, in partnership with Homestar Builders (a division of American Homestar Corporation), has just introduced the Homestar Homes program, which provides high-quality, affordable, permanent homes to residents who plan to rebuild in the area. Nine different home models, ranging from 620 to 2,078 square feet, have been developed for the introduction of this program. Each comes with several high-quality custom options and features supplied by The Home Depot.

Homestar Homes are factory-built houses that are engineered and constructed to the same International Residential Building (IRC) codes required of site-built homes. The construction of each home is monitored by third-party inspectors to ensure they are built to high-quality and code standards. Once the basic home is complete, it is transported to the homesite. There, Home Services specialists complete the on-site construction using merchandise selected through the Home Depot store, including lighting fixtures, flooring, appliances, countertops, window treatments, fencing, landscaping and more.

As part of an initial pilot project, furnished and decorated model homes will be displayed at select The Home Depot stores in the New Orleans area. The very first store to feature this program is on I-10 at Bullard Avenue. Customers are encouraged to tour the models and will be able to meet with an on-site Homestar Homes housing and design consultant for more information or for assistance through all phases of the home-buying process, including site preparation and construction, mortgage financing and insurance.

An American Homestar spokesman said, "We believe we were selected by The Home Depot because of our strong regional presence, product quality and proven experience in guiding customers through the entire home-buying process. We are one of very few companies in our industry with this turn-key capability and are proud to partner with The Home Depot in providing significant, and somewhat unique, housing solutions to some of the most severely affected areas in the region."

Founded in 1971, American Homestar sells its factory-built homes through a network of company-owned and independently owned model home centers, builders and developers throughout the South Central and Southwestern U.S. In addition to home manufacturing, the Company provides financial services to manufactured and modular homeowners, including construction financing, permanent financing and insurance.