1Q10 Multi-Family Report Update

1Q10 Multi-Family Report-update

As we reflect back on the first quarter of 2010, many of last year’s trends have carried over to this year.  Many sellers are still heavily negotiating on their prices and the ability to obtain financing remains a challenge.  The home buyer tax credit was just one of many factors motivating consumers to buy homes.  Buyers were also able to take advantage of low interest rates and competitive prices to get a home they may not have been able to purchase a few years ago.  The full extent of the tax credit, however, will not be realized until the June 30, 2010 closing deadline.

New Construction      

Buckhead:

In the Buckhead sub-market, 10 Terminus Place, Gallery Residences, and Paramount lead the way in absorption and helped achieve a 230% improvement in absorption over the first quarter of 2009. 

• Absorption – up 230% to 43 homes
• Average Sales Price – down 7% to $588,039

Intown:

Both absorption and average sales price in the Intown sub-market declined from 1Q09. 

• Absorption – down 27% to 66 homes
• Average sales price – down 30% to $227,179

The majority of the absorption was from Twelve Centennial Park, Viewpoint, and Element.  It is important to note the Element auction contributed 40 units to the total absorption in 1Q09.

Downtown:

In the Downtown sub-market, Oakland Park, The Stacks at Fulton Cotton Mill, and Kirkwood Station were the majority contributors to absorbed homes during the first quarter of 2010.

• Absorption – up 15% to 23 homes
• Average sales price – down 15% to $179,924

Resale

Both the Buckhead and Intown sub-markets had an increase in absorption over 1Q09 while sales prices have continued to decline.  However in the Downtown sub-market, there was a slight decrease in absorption over 1Q09 and a slight increase in sales prices. 

Buckhead

• Absorption – up 5% to 167 homes
• Average sales price – down 12.3% to $195,318

Intown

• Absorption – up 22.4% to 268 homes
• Average sales price – down 9.7% to $174,372

Downtown

• Absorption – down 2.9% to 67
• Average sales price – up 5% to $140,623

Sales prices for both new construction and resale have continued to decline, new construction homes in the Intown and Downtown sub-markets are achieving a 20% to 25% premium over resale, a rate that is considered very favorable.  During the first quarter 2009, the rate was near 40% for both sub-markets.

In conclusion, many buyers are cautiously returning from the sidelines, but they have a new set of priorities and requirements that need to be addressed.

1Q10 Multi-Family Report-update