Local Real Estate Comments and Ramblings

head_left_image

What is up with the Atlanta Housing market? Prices!!!

 

What is up with the Atlanta Housing market?  Prices!!!

Back in 2007 and 2008 I predicted that the housing crash was going to be more severe and longer lasting than many people expected. Once we were in the depths of the houses crisis I predicted that we would not see recovery until investors started buying up inventory.  With a 1-2 year supply of homes on the market that was only way to dry up the excess inventory.  Looking in the rear view mirror I was right on both of those points.

Here is where I was (pleasantly) wrong.  Up until 2007 the Atlanta housing market was the "tortoise" of the national housing market.  Slow and steady with no volatile gains or decreases.  The average appreciation for .the area ranged from 2-4% per year.  From the late 1970's to 2007 there was only one time with 3 quarters of depreciation.  That was in the early 1990's and was only about a 1- 2% decline in total.  It was barely a blip in the big picture. (source http://www.fhfa.gov/Default.aspx?Page=216&Type=compare&Area1=12060&Area2=&Area3= )  I presumed that once the market dried up that we would resume to traditional rates of appreciation.  What I didn't count on was the huge number of large institutional investors that would figure out what a great market Atlanta is to buy and rent.  We have always had good rent to value ratios and with the decrease in prices and no decrease in rents that rent return was even higher!  

Right now the market supply has swung to the opposite extreme.  2 years ago we had a 1-2 year supply of homes available in most areas and price ranges. Today it is 2-4 months of supply. Nice homes that hit the market are getting multiple offers in in just a few days!  All of this has resulted in an average 16+% increase in Atlanta home values over the last year.  

What happens when the investors stop buying or more importantly what happens when they start selling?  In my opinion... not much.  While the investors have rushed in to the market in the last 12-18 months they will exit very slowly.  Some will decide they hate property management or maybe decide they can get decent returns with other investments.  Others will stay in for the long haul and be very happy with the 10-20% returns they are seeing.  Regardless, the exit will be over several years as the tenants move out and the homes become vacant.  The influx of supply will be over several years and have little impact on over all values.

Even though prices are up dramatically and homes are selling like hotcakes the news is not all good.  According to a recent article in the AJC home prices are up 16.5% but still only are back to the same level as 1999.  In other words if you bought your home anytime in th last 13 years there is still a good chance that it is worth less than you paid.  Metro Atlanta home prices regain lost ground

With the decline in prices there are also still a significant number of people that are "upside down" in their home.  That is they owe more than the current value. Percentage of mortgage holders that are underwater, by ZIP code.  

The upward momentum is VERY strong right now and momentum is very slow to change directions once it gets going. We should see many months of continued very strong appreciation.  Eventually we will get back to a point of equilibrium and probably see more traditional appreciation in the 2-4% per year range.

So what does all of this mean to you?  For all the hoopla about increasing prices we are still near the bottom of the market.  There has been a enough of a shift to see that market has turned but it is a great time to BUY!  Think about it.  you can buy a home today for what it was worth in 1999-2000.  Get the added bonus of record low interest rates!   If you are a first time buyer there are a tom of houses available under $150,000.  With taxes, insures and the works you are looking at a payment more or less around $1000 per month.  

Are you thinking of buying a home to use as a rental investment?  Those same factors are at work and rents did not decrease with values.  My investor clients routinely get over 1% per month return in their value. So you can put your money in savings for 1% per year or invest in real estate and get 1% per month PLUS appreciating value,PLUS tax benefits!

If you are thinking of buying, selling, or investing, call me today!


*****

 

 


Bob Southard
Broker - Owner  Atlas Realty Service LLC #75911

O:678-439-SOLD(7653)

CALL ME DIRECT: 770-656-9134

Buy a home, Sell a home, in Powder Springs, Marietta, Kennesaw, Acworth, Smyrna, Dallas, Hiram,and Cobb, Paulding, Douglas, North Fulton, South Cherokee, County, Ga. Call me for all of your real estate needs.

Visit my website

www.AgentBobSells.com

 

Contact Agent Bob

Call me for all of your Real Estate needs

678-439-7653

Copyright © 2008,2009,2010,2011,2012,2013,2014,2015,2016,2017 By Bob Southard, All Rights Reserved

 

Follow Bob on Twitter , FaceBook, and LinkedIn

 

Agents! $19.95 for 800 capture,fax,virtual tours,showing feedback,more!

 

Comment balloon 2 commentsBob Southard • May 06 2013 05:42PM
What is up with the Atlanta Housing market? Prices!!!
share
What is up with the Atlanta Housing market? Prices!!! Back in 2007 and 2008 I predicted that the housing crash was going to be more severe and longer lasting than many people expected. Once we were in the depths of the houses crisis… more
Flip this house, my version!
share
Flip This House Day 1 It's been a while since I have flipped a house myself. I have helped plenty of others buy and sell but this is the first time in a while I have jumped in personally… I won't post daily updates but… more
Appearing on Family Feud
share
Family Feud.. The Answer Is A few of The Southard kids and host Steve Harvey When we were kids we would sit and watch Richard Dawson and Family Feud all the time! My mom loved the show and applied for us to play but we never got… more
Buying or selling a Home in Alpharetta, Ga
share
Buying or selling a Home in Alpharetta, Ga Are you searching for a home in Alpharetta, Ga.? Here is the only Alpharetta Home Search you will ever need! There are two mls systems in metro Atlanta and this search… more
Buy or Sell a Roswell Ga Home
share
Buying or Selling a Home in Roswell, Ga Are you searching for a home in Roswell, Ga.? Here is the only Roswell Home Search you will ever need! There are two mls systems in metro Atlanta and this search includes BOTH so… more
Beer, Taco Mac, and Real Esate…
share
Hi Taco Mac Fans! I had the incredibly good fortune to be the winner of the 2012 Southern Home Brewers challenge sponsored by Taco Mac and Red Brick Brewing. Beginning on Jan 1 it will be one of the featured beers of the Month at every Taco Mac!… more
Buy or Sell a Woodstock Ga Home
share
Buying a Home in Woodstock, Ga Are you searching for a home in Woodstock, Ga.? Here is the only Woodstock Home Search you will ever need! There are two mls systems in metro Atlanta and this search includes BOTH so that… more
Kennesaw Georgia, Buying or Selling a home
share
Buying a Home in Kennesaw, Ga Are you searching for a home in Kennesaw, Ga.? Here is the only Kennesaw Home Search you will ever need! There are two mls systems in metro Atlanta and this search includes BOTH so that you… more
155 Brownsville Rd for Rent
share
155 Brownsville Rd - $850 per month … more
4515 Verdant Woods Ct., Powder Springs, Ga 30127
share
Welcome Home! 4515 Verdant Woods Ct Powder Springs, Ga 30127 * See the video tour $320, 000 - 4515 Verdant Woods Ct, Powder… more
The Fairways at Towne Lake, Woodstock Ga
share
Fairways at Towne Lake subdivision, Woodstock, Ga., 30189 * * Fairways at Towne Lake subdivision in Woodstock Ga is a beautiful neighborhood conveniently … more
My YouTube video has over 38, 000 views!
share
My YouTube video has over 38, 000 views! Seveal years ago I got a new video camera and was just playing around trying to figure out how to record, edit, and post video. I just had this idea to… more
Victoria Cottages, Woodstock, Ga. 30189
share
Victoria Cottages Victoria Cottages subdivision, Woodstock, Ga., 30189 * Victoria Cottages subdivision in Woodstock Ga is a beautiful neighborhood conveniently… more
Towne Lake, Woodstock Ga., 30189
share
Woodstock Ga. Zip Code 30189 Homes for sale * * Search all homes for sale in Woodstock Ga. zip code 30189. This is the only home search you'll ever… more
Tax Benefits of Depreciating Rental Properties
share
Are you thinking of buying a rental investment home? Do you have a home that you are thinking about renting out because can't or dont want to sell at todays prices? There are huge tax advantages that are available for landlords! Tax… more
Eagle Watch Golf and Country Club, Woodstock, Ga
share
Eagle Watch subdivision, Woodstock, Ga., 30189 * Eagle Watch subdivision in Woodstock Ga is a beautiful Swim, Tennis, and golf neighborhood conveniently located in… more
FHA Guideline On Seller Paid Closing Costs
share
A great post about what can or cannot be included in FHA seller paid closing costs for the buyer. I slightly dis agree with the authors commetn that the closing costs are added back to the price. In our area an din todays market the seller should… more
Sprayberry High School Homes, Cobb County Ga
share
Buy or Sell a home in the Sprayberry High School District, Cobb County, Ga. Sprayberry High Homes For Sale If you are interested in buying or selling a home in the Sprayberry High School district of Cobb County, Ga., all the information you need is… more
Browns Farm Subdivision
share
Browns Farm Subdivision Browns Farm subdivision, Powder Springs Ga., West Cobb * Browns Farm subdivision Powder Springs is a beautiful Swim? Tennis neighborhood… more
Hamilton Township, Kennesaw, Ga
share
Hamilton Township Hamilton Township, Highlands at Hamilton Township, and the Estates at Hamilton Township subdivision, Kennesaw Ga., West Cobb * Hamilton Township, Highlands at Hamilton Township, and the Estates at Hamilton Township… more