Category Archives: Housing stats in Atlanta

The Real Truth About the Atlanta Market

Posted on February 9, 2012 by | Leave a comment

Atlanta certainly has taken a beating in the local and national media over the past week.  The latest Standard & Poor’s Case-Shiller Home Price Index report was released, ranking Atlanta second only to Detroit, with a price index of 88.93, down from a high of 136.47 in mid-2007. This represents the fourth straight month of decline for the city, and a 13% year-over-year decline, the largest loss of any metropolitan area in the country. This brings the median home price in Metro Atlanta to $178,000, down 12% from December 2010, the lowest it has been since 1998.

Not all areas in Metro Atlanta have suffered from such drastic deflation. Sub-markets inside the I-285 corridor, along with areas of North Fulton County have retained value far better than homes in the outlying areas.  With foreclosure and short-sale inventory at an excess in the suburbs, prices continue to fall, dragging averages  for the entire metro area down. 

On the bright side, inventory in the area is decreasing.  Currently, metro Atlanta’s home supply is at a 10-year low, with the number for new construction being the lowest it has been in 15 years.  In 2009, there were over 120,000 available units on the market.  This number has shrunk to under 50,000 units today.

More positive news arrived when the latest unemployment numbers were released.  The national unemployment rate is down to 8.3%, the lowest it has been in three years.  In Georgia, unemployment decreased for the third month in a row, to 9.7%, down from a high of 10.4% in December 2010.

More people entering the job market, coupled with low supply and record low prices and interest rates could spell relief for metro Atlanta home sales.  According to the National Association of Realtor’s Pending Home Sales Index, sales reached a 19-month high in November and the trend continues.

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Posted in Atlanta Real Estate Market, Housing stats in Atlanta, Value of a home

Block Talk: Year-Over-Year Changes in Atlanta Distressed Sales

Posted on August 26, 2011 by | Leave a comment

By Judy Price

For this week’s column, I pulled numbers from our Universal Database to see how the Atlanta market is performing in distressed sales (as a percentage of overall sales numbers) year-over-year for 2011 vs. 2010.

  

The table above summarizes year-over-year changes (to date) in the amount of sales in FMLS that were foreclosure, lender-owned, corporate or short sale. The only category to see improvement is single-family new construction homes. While the supply of distressed inventory remaining in this category is at 8 months, as discussed in my April 22nd column, the amount of inventory is continuing to decline which is resulting in the year-over-year improvement in this distressed number.

As to the other categories, a continued increase in distressed sales can result in additional downward price pressure to a market bouncing along the bottom. However, the low months of remaining supply of resale distressed inventory is positive and provides some hope that we are working through some of the distress. What remains to be seen is how much shadow foreclosure inventory Atlanta has coming as the banks continue to work out the process.

A quick reminder on my methodology. For the single-family home data, I pull numbers from a 6-county area of Cherokee, Cobb, Fulton, Forsyth, DeKalb and Gwinnett. For Condos/Townhouses, I use a 4-county area of DeKalb, Cobb, Fulton and Gwinnett. Respectively, over 80% of sales occur in these counties.

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Posted in Bank Owned, Block Talk, Distressed Sales in Atlanta, Foreclosure, Housing stats in Atlanta, Market data

Block Talk: Consumers are Still Buying Homes…..Will They Buy Yours?

Posted on August 12, 2011 by | Leave a comment

By Judy Price

For July, the sale of single-family homes experienced a 17% year-over-year increase and a 19% increase for condos and townhouses. Here at NRTDA, we experienced our own successful July with strong sales of distressed single-family homes in the suburbs, townhouses in Buckhead and condos in Midtown Atlanta.

With July’s success behind us, the real estate market has wondered what would happen next because of the credit downgrade. This week, mortgage rates have dropped to or near all-time lows as investors moved money into safer bonds and mortgage backed securities that fund most home loans.

Yes, there are buyers who have now called off their search completely since they would need to sell stocks for a down payment. However, we are also hearing stories of buyers who have decided to stay the course because rates are so low. Real estate as a long-term investment remains attractive to many, even right now.

So how will you capture these buyers? Because supply still outpaces demand, make sure you pay attention to the fundamentals of the 4 P’s: Product, Price, Place and Promotion.  

Questions to consider:

  • How does my product look to potential buyers?
  • How competitively am I priced?
  • How is my location? Do I need to make an adjustment for the location?
  • How am I getting the most reach for my marketing dollars?

Based on your goals to sell, you may need to make adjustments to your sales and marketing strategy to reach those buyers that are still in the market. But don’t delay or you will lose out to your competition.

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Posted in Atlanta Home Prices, Atlanta Real Estate, Block Talk, Housing stats in Atlanta, Interest Rates, Uncategorized

Block Talk: Premium for Condos in Atlanta’s Inner Core

Posted on July 15, 2011 by | 1 Comment

July 15, 2011

By: Judy Price

We often talk about the gap between the price of new construction and resale homes, but is there a gap between prices of properties located in different areas of the city? To make such a determination, I divided Atlanta locations with the majority of condominium product in two: the inner core and outer core. For the purposes of this study, the Inner Core is located on or in immediate proximity to Peachtree Street. My research did show a gap in condo pricing; today I will share with you the price differential for condo sales occurring in the inner versus the outer core of Atlanta.

As I dug deeper into my research, I noticed a large amount of active two bedroom (2BR) inventory. Years ago, buyers demanded 1BR units. But these buyers sought to move-up, causing the demand to switch to larger units with upgraded finishes. Developers responded, but then the real estate market slowed down to where we find ourselves currently. The result? A large supply of 2BR new and resale condo inventory is available across Atlanta. As prices have adjusted down since 2007, the inner core has become more affordable than it has been for years, and a large amount of this excess 2BR inventory is located in the most desirable areas. To narrow my focus on pricing trends, I decided to analyze 2BR condo inventory.

Inner Core vs. Outer Core (2 Bedroom) Sales since January 1, 2011

Inner Core

  • 51 total solds. New at $242 per sq. ft. and Resale at $188 PSF.
  • Data shows a positive sign that distressed inventory is being absorbed.

Outer Core

  • 23 total solds. New at $171 per sq. ft. and Resale at $115 PSF.
  • Distressed inventory still playing a prominent role in the fringe neighborhoods.

(Zips: 30308, 30309, 30312, 30318)

Inner core new construction condos are achieving a 29% premium over the outer core and inner core resale condos are achieving an even higher premium, at 39%. Inner Core resales are also selling at a higher price per square foot than new condos in the outer core.

Now, more than ever, it is important to understand each market and how to position inventory to stay competitive. With the large amount of inventory available, I will continue to monitor these markets as more downward pressure may be placed on price.

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Posted in Block Talk, Housing stats in Atlanta, Market data

Block Talk: Pre-Foreclosures

Posted on May 6, 2011 by | 1 Comment

By Judy Price

Two weeks ago, I analyzed pending sales, a lending indicator of future closings. This week, I’m highlighting another way that NRTDA looks for future trends, this time in the filings of pre-foreclosures. But before we look at the data, let’s review the definition of a pre-foreclosure first.

A pre-foreclosure is the legal event and notification of a present default. In Georgia, for a foreclosure to move forward, it must be advertised for four weeks before the bank can foreclose. Why do we look at this metric? Well, while not all pre-foreclosures actually turn into foreclosures (often the borrower works something out with the bank), by tracking movement up or down, we can look for signs of improvement or further distress in the foreclosure market.

A review of pre-foreclosure filings over the past 12 months uncovered:

Detached Single Family Homes (Cherokee, Cobb, DeKalb, Forsyth, Fulton, Gwinnett)*

  • While there was a slight uptick Feb 2011, pre-foreclosure notices have been on the decline since Nov 2010.
  • For new construction, there were 73 notices in February and 72 in March.
  • For resale, there were 2,076 notices in February and 1,734 in March.

 Attached Condos/Townhomes (Cobb, DeKalb, Fulton, Gwinnett)*

  • Same as detached, there was a slight uptick in Feb 2011. That one month aside, pre-foreclosure notices have been declining since Dec 2010.
  • For new construction, there were 25 notices in February and 19 in March.
  • For resale, there were 355 notices in February and 223 in March.

I’ve performed a number of market studies over the past 12 months and have seen figures quite high for pre-foreclosures, leading to long discussions about market realities. But today I’m feeling like this glass is half-full. The declining level of notices is a positive sign. Even if this means we start to see an up-tick in short-sales, at least this says that the banks are trying a different route to work through distressed homes.

*Big thanks to RealValuator for providing us with such a valuable tool that we can use to help our clients.

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Posted in Atlanta Real Estate, Block Talk, Condo, Foreclosure, Housing stats in Atlanta, Market data, Trends

Block Talk: Atlanta Q12011 Single-Family New and Resale Update

Posted on April 22, 2011 by | 1 Comment

By Judy Price

This week I attended the Greater Atlanta Home Builders Association’s Builder/Developer/Lender forum. This monthly roundtable event allows industry professionals an opportunity to share ideas and have an open dialogue about the real estate market. NRTDA’s very own Bob Romano was featured this week to talk about Q12011 trends. Here’s a recap of the findings:

Permits. 900+ permits pulled so far this year. The top 25 builders pulled 60% of the permits. Last year by this time, approximately 1900 permits were pulled. A glimmer of hope came up at the meeting: a lender in the group was proud to announce she was closing a construction loan this week.

Resale Single Family. Within a 6-county area* there has been a strong increase in pending resale inventory (pendings are a leading indicator to sales) the first three months of the year, just like in 2010. While this is expected because of seasonality, this year these pending sales come without the help of the tax credit. At the end of March, there were 3600 pendings in the 6-county area. The estimated months of supply is currently 9.3 months, which is down from 12 months in February. While the year got off to a slow start, velocity is increasing, just later than last. Check out the graph below:

New Homes. On the new construction single-family home side (6-county area), the data is showing a 33% increase in pending home sales from February to March. And as the inventory is being absorbed, the percentage of new construction distressed sales continue to decline year-over-year. Distressed sales were 23.8% of all sales in 2010 and so far in 2011, 17.8%.

 *Cherokee, Cobb, DeKalb, Forsyth, Fulton and Gwinnett

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Posted in Block Talk, Housing stats in Atlanta, Trends, Uncategorized

Roger Tutterow’s insight on the every-changing economic, political and business climate

Posted on October 29, 2010 by | Leave a comment

By: Brad Horner

Thanks again to all who attended Wednesday’s Developer Forum featuring Roger Tutterow, professor of economics at Mercer University’s Stetson School of Business & Economics.  He, as always, provided such interesting insight on the ever-changing economic, political and business climate.

Many attendees requested copies of Roger’s presentation, which you can download here.  Included are the very telling graphs about consumer sentiment, economic indicators, NAR Housing Market Index, equity markets, Federal budget, the upcoming elections and so, so much more.

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Posted in Housing stats in Atlanta, Interest Rates, Market data

Coldwell Banker NRT Development Advisors releases 2nd Quarter 2010, quarterly view of metro Atlanta’s real estate market!

Posted on July 13, 2010 by | 1 Comment

Coldwell Banker NRT Development Advisors recently released its Q2 2010 Development Advisor*, a quarterly view of metro-Atlanta’s real estate market (including absorption, current inventory, sales price, distressed sales, consumer sentiment and more).  Highlights about the 15-county metro area from the Q2 2010 report include:

  • SINGLE FAMILY:  Consumer demand has declined precipitously with the recent expiration of the Federal tax credit. May and June are typically the best months for pending home sales in anticipation of closing prior to school starting in August. In May, 2010, pending home sales dropped 46% from April, 2010, however June, 2010 was up by 6% over May volume. Although it is a positive sign to see an increase in pending home sales, this number is still down 15% over June, 2009. There is also a sense of caution among builders in buying vacant developed lots. Opportunities for resets can, however, be found with accurate analysis and due diligence for proper positioning within a niche market.
  • MULTI-FAMILY:  Preliminary numbers point to positive signs in the multi-family market as well. Pending home sales for both new and resale in June,2010 were up over 200% over June, 2009 and were also up 80% over May, 2010 volume. It is important to note that more than half of the June, pending home sales were of distressed homes (foreclosed, short-sale, lender-owned, and corporate owned). New construction home data are not complete because not every home is listed. However later in the 3rd quarter, deed-based transactions will provide a much more accurate picture of the multi-family new construction market.

To view the full Q2 2010 Development Advisor, click here.  Past reports can be downloaded here.

*Information for the quarterly review is complied largely from the company’s proprietary Universal Data Base, a system that pulls data for the entire metropolitan Atlanta market from both FMLS and GAMLS, deleting any duplication.  The report includes submarket profiles for Cherokee, Clayton, Cobb, Coweta, DeKalb, Douglas, Fayette, Forsyth, Fulton (North and South), Gwinnett, Hall, Henry, Newton, Paulding and Rockdale counties.  Multi-family home sub-market profiles are also included for Buckhead, Intown, Downtown and other urbanizing areas.

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Posted in Housing stats in Atlanta, Market data, NRT Development Advisors

4Q2009 Quarterly Review of Metro Atlanta just released!

Posted on February 28, 2010 by | Leave a comment

By: Brad Horner

Welcome to the 2009 Annual Review edition of The Development Advisor, our quarterly report of the metropolitan Atlanta residential market. This report utilizes data based on transactions that closed in 4Q09 and compares it to that of 4Q08 as well as 1Q09, 2Q09 and 3Q09. We have compiled much of our information from our proprietary Universal Data Base, a system that pulls data for the entire metropolitan Atlanta market from both FMLS and GAMLS, deleting any duplication.

As we begin a new decade and look back over the past few years, many of us are relieved that one of the most challenging times in Atlanta real estate may be behind us. Overall, the results in the fourth quarter continued the improvement over the low points established in 4Q08 and 1Q09, signaling further signs of a slow recovery.

Similar to the third quarter of 2009, we continued to see mixed messages indicating a possible long awaited turn in the market. Absorption levels increased for new condo/ townhomes, but decreased for new single family and both types of resale. Average sales prices for new and resale condo/townhomes increased while prices for new and resale single family decreased. Even though sales prices are down overall compared to 4Q08, we have seen a light at the end of the tunnel with resale single family up 0.9%

The most significant news lies in the fact that current inventory levels continued their year long decline in 4Q09, with a 25% decline in all active listings compared to 4Q08. With building permits at historic lows and very little new construction condominium/townhome inventory being delivered in the foreseeable future, there was a 41.5% decline compared to 4Q08.

The extension of the tax credit and the expanded tax credit for current homeowners, combined with historically low interest rates and the second highest affordability index have created the perfect time to take advantage of homeownership. However, the pressures of high unemployment, difficulty in obtaining a mortgage, foreclosures and short sales continued to play a significant role in the uncertainty of the overall market’s improvement.

We hope you will find this edition of The Development Advisor informative and useful. Today’s market is unlike any we have experienced in the past, making it even more important to work with a sales and marketing partner that has a thorough and complete understanding of today’s challenges. We welcome any questions that you may have regarding this report and the future of the Atlanta residential real estate market.

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Posted in Housing stats in Atlanta, NRT Development Advisors, Real Estate, Sales and Marketing, Uncategorized

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