I think it’s time to consider buying a home in the Atlanta area. I don’t say that as a shill for any real estate organization; I say that as an appraiser, broker and student of this industry for over twenty years. The data, coupled with rates that have been ridiculously low for so long combined with the prevailing expectation by most economic “experts” that rates will/have to rise after the election make now the time to legitimately consider a home purchase. Note I said consider – buying a home isn’t something everyone should do.
Are home prices still dropping in Atlanta?
Yes – Atlanta home prices are falling when the 15+- counties considered “Atlanta” are included. However, many real estate markets in Atlanta are finding stability, the idea that home prices in Atlanta remain in a funk with no end in sight is simply not accurate when you get a little deeper into the data. Case-Schiller and other macro researchers look at Atlanta as one real estate market; it’s not. Atlanta is a series of micro markets; each is unique and each is recovering in its own way. Home prices in Alpharetta, Roswell, Marietta and other North Atlanta have shown stability. New homes are again being built in Alpharetta, Milton, Johns Creek and other areas. I look at new construction activity as the canary in the coal mine; battered as that segment was, builders and lenders are not getting into areas that they don’t have confidence in.
How many homes are for sale in Atlanta?
Fewer than there used to be and that seems to be everywhere. Reasons vary but the main ones include folks not selling unless they have to, the robosigning foreclosure slowdown (but foreclosures aren’t going away), increase in small investor activity due to dropping prices, low rates and a strengthening rental market and a simple increase in the number of sales. In some areas, we’re seeing continually dropping days on market times and increasing sale to list price ratios. The recipe for seller success has not changed; make it appealing, present it well and most importantly – price it accurately.
A seller’s market in Atlanta?
Not yet. However homebuyers in areas like East Cobb, Alpharetta and Johns Creek (to name a few) will see multiple offer situations, highest and best offer requests and sellers that aren’t agreeing to every buyer demand. It’s no secret that many buyers have lost patience and interest in foreclosures and short sales; savvy “traditional” sellers will attract buyers. I have several new construction deals underway right now and can say that builders, while a bit more accommodating than before the crash, are none the less not rolling over for buyers. So while I’m not ready to call it a seller’s market, it’s also not a clear buyer’s market in some areas either.
The future – not that anyone knows…
Whether or not the economy is recovering is up for debate. Personally, I don’t see how $4/gallon gas, continued weak employment, low consumer confidence and a steady drumbeat of poor national and global economic performance constitutes a “recovery”. I’ll attribute that to election year nonsense because folks I speak with are far from “recovered”. The one thing that economic “experts” seem to agree upon is that rates will almost certainly rise after the election. Rise is relative; I think the consensus is that they will get back into the 6-6.5% range; still not bad at all. It’s also recognized that the Atlanta foreclosure issues are not going away, there is a shadow inventory and it will be with us for the foreseeable future. As for the mortgage industry, I hear talk of subprimes easing back into the mix….
The bottom line
Not everyone should buy a home. Do your research, honestly evaluate your ability to own a home and above all, get educated about the entire process. I cannot overemphasize the importance of working with an experienced and candid agent; it is critical to your economic health to thoroughly qualify and evaluate your agent. Buying a home will always have some level of risk associated with it. However, we all have to live somewhere and the opportunities that exist at this time will be going away. If you’re on the fence, think about contacting an agent, speaking with a tax pro to compare renting/owning, run stats for different areas and immerse yourself in the data – now might be your time to jump in pool.