If you're involved in the Atlanta residential real estate market in any capacity, buyer, seller, agent or other, you've noticed that something has changed over the last year. The market has shifted significantly. Homes are selling fast, and I mean crazy-fast. What's "crazy-fast?" Days. Sometimes just one day. Sometimes not even a day. Often with multiple offers. I've experienced faster than expected sales recently on both sides of the transaction, on my own listings and when representing buyers. And from speaking with other agents around time, I'm not alone. "Sure," you might say, "that's anecdotal evidence, but is it really true for the Atlanta market as a whole?" I looked at the numbers and here's what I found.
I checked the FMLS records over the last 3 years to see how many homes sold each year in various days-on-market brackets. For the purposes of this blog post, I'm just using single-family homes sold in the city of Atlanta. Below are the numbers:
Homes sold in 14 days or less in Atlanta:
Homes sold in 7 days or less in Atlanta:
Homes sold in 3 days or less in Atlanta:
Homes sold in 1 day or less in Atlanta:
Of course we all know that neighborhoods are important for many reasons; friendly neighbors, community support, etc. And we all know there are many reasons to choose a particular neighborhood; location, style, affordability, etc. However, from the perspective of your wallet, there's another important benefit the right neighborhood can provide; price stability.
A recent study by the Joint Center for Housing Studies of Harvard University showed that higher-priced homes are less susceptible to bubbles than are lower-priced homes. Higher-priced homes don't appreciate as quickly in a run-up, but neither do they fall as quickly in a downturn. According to analysis of Standand & Poor's / Case-Shiller home price data, prices of lower end homes in Atlanta fell by nearly 50% from the 2007 peak to December 2010. The drop for higher-end homes fell by less than half that percentage. Of course, this is a macro look at the entire Atlanta metro area, in which "low tier" homes were qualified as those under about $122k and "high tier" homes were those above approximately $221k. You might extrapolate from this data that even higher-tier homes in desirable neighborhoods may have lost even less value since the 2007 peak. You'd be right. A quick check of the sought-after Intown Atlanta neighborhood of Morningside shows an average sale price of $668,952 in 2007. The average sale price in 2010 was $582,339, a 12.9% decrease from the peak. That's certainly a lot better than the national average. Checking the Buckhead neighborhood...
In our experience selling homes, we often find that a person's perception of their home's value often differs from the reality of the marketplace. There are number of reasons for this, from psychological factors to simple misconceptions about market value. In this article we will discuss these issues as well as how best to determine an accurate selling price.
Home Seller's Top 7 Pricing Mistakes:
1.) Not being objective
One of the first explanations of the disconnect between real and perceived value is simply human nature. Outside of family, friends and pets, our home is quite possibly the most difficult thing in our lives to be objective about. We likely have more emotional connection to our home than only other inanimate object. Sure, some guys might claim it would be their car, truck, motorcycle, boat or flat-screen HDTV. But when you factor in the monetary investment that the home represents, that usually bumps the home into the number one position in importance. When looking at our own homes we tend to play up the positives and overlook the negatives. When looking at other people's homes, whether they be recently sold comparables, competing homes on the market, or homes one is considering purchasing, we tend to do the opposite. The goal is to try to view your home through the eyes of a prospective buyer. This is very difficult to do, so it's best to just look at the cold hard facts, i.e. the numbers. But what numbers? Where do you get them? How are they derived? We'll get more into that later.
2.) Depending on online home valuations
Previously we wrote about online home valuations, and how misleading they can be. They can be fun to play with, but they're simply not accurate. They can be off 25-30% or more, easily skewing the real value by hundreds of thousands of dollars in some cases. They're brain-dead number-crunching computers that don't know the Intown Atlanta market. You can read the full...
This week brought a couple pieces of good news about the Atlanta real estate market. First, a report released by Metrostudy shows that Atlanta's housing market has hit bottom, with primary indicators having reversed and now trending to the positive. Although the trend is positive for sellers, we at Intown Elite believe that buyers continue to maintain the power in negotiations, since there’s still nearly 13 months of inventory on the market.
The other good news for the real estate market is the extension of the $8,000 tax credit for first-time home buyers until May 1, 2010. In addition, a credit up to $6,500 is available for other home buyers who have owned their current homes for at least 5 years. This opens tax incentives to "move-up" buyers who are purchasing a primary residence.
As always, there are limits to these credits, so please contact your real estate professional for the details. These tax credits are not likely to be further extended, so if you are considering buying a home, now is the time.
Please feel free to contact us here at Intown Elite with any questions you have about the new tax credits. Thank you and happy house-hunting!
"I'm looking for a really good deal." That's what just about every buyer says when they first speak with us about buying a home. Not that they're looking for a particular style of home with a specific number of bedrooms or baths, a specified location or even whether it's a condo, townhome or single-family home. We’re finding that buyers are focusing more on the type of deal they can get rather than what attributes they really want in a home.
Of course, everyone wants a good deal, but it's important not to get so tunnel-visioned that you miss out on the perfect home for you, because you're holding out for the deal of the century. Do you want a good deal on a home you love, or a great deal on a home that's just OK? You have to live there. If you don't love it, is it really that great of a deal?
Waiting for the bottom? Many folks are sitting on the sidelines, waiting for the bottom of the market before they’ll jump in. If that sounds like you, how will you know when the market has bottomed out? Market timing is a tricky game to play. Check out the graphic below:
Let's say the graphic represents the housing market. Although the market is cyclical, with ebbs and flows,, most people tend to think in a straight line. Point A was near the peak of the market. Although the market was overinflated, many people thought that prices would continue to climb. This was a contributing factor to the "bubble" that occurred in some markets.
Then, the market began to take a turn in the opposite direction.. Let’s say that now we're at the other end of the spectrum (point B). The market has turned downward and people wonder if we’re near the bottom. The big question on everyone’s...
It’s been a while since we made a blog post, partly due to the holidays, but partly because we have been busy with several new buyers. Why, in an uncertain economy, are so many buyers jumping into the real estate market? Do they know something you don’t know? It’s really quite simple - the current market condition represents an unprecedented opportunity for home / condo buyers. So what makes now such a great time to buy?
It’s a buyer’s market.
That’s because there are currently many more people trying to sell real estate than there are people willing and able to buy. That means prices are lower and sellers are more negotiable now than in the past.
Scarcity = Leverage.
Qualified buyers have the power. Not only are there fewer buyers than there are sellers overall, but banks are being more strict on their lending standards. Gone are the no-doc “liar’s loans”, sub-prime, Alt-A and other crazy loan products that created the financial mess we’re in. These tougher standards make qualified buyers even more scarce. If you are a qualified buyer in this market, you are the rare gem. This gives you the upper hand in negotiations.
Mortgage rates near 50-year lows.
Not only can you get a reduced purchase price on a home, but your cost to borrow money is also at historical lows. Many Atlanta mortgage lenders have reported rates under 5% for a 30-year fixed-rate mortgage! This also increases your buying power, enables you to buy more home for a given payment, or get a lower payment on a given home.
People are funny.
Human behavior is sometimes irrational and we often repeat our...
With all the doom and gloom on the news, are there any bright spots out there? Yes, of course there are! One is the falling price of oil, gas and other commodities, which helps to soften any downturn in the economy. But what may surprise you is that the resale home market is another bright spot.
We've written in previous blog posts that the Intown Atlanta market has been doing quite well, in contrast to many other parts of the country. But now comes news that the country as a whole is rebounding in terms of existing home sales. In September, existing home sales jumped 5.5% as affordability has improved. Improving affordability in some markets has to do with home prices correcting to more reasonable levels after steep run-ups in bubble markets. But another factor that improves affordability in all markets is interest rates.
Recent actions by the federal government, including the takeover of Fannie Mae and Freddie Mac, as well as the economic "rescue" plan, has lead to lower interest rates for home loans. Very often buyers can now get fixed-rate mortgages under 6 percent. Check with a qualified mortgage lender to see what kind of rate you can get.
The jump in sales last month was the largest since 2003, and outperformed economists expectations. Many economists have said that the economy will not recover until the housing market stabilizes, to this is welcome news. This news coupled with declining inventory may imply that the housing market has reached a bottom. This emphasizes what a great time it is to buy now.
In a previous blog post, we mentioned how the Intown Atlanta real estate market was different than the "bubble" markets, which have lost so much in home values lately. By contrast, single family homes in Intown Atlanta are holding their own. In fact, many established Intown Atlanta neighborhoods can boast rising home values in recent months. But don't take our word for it, check out this recent article in the Atlanta Business Chronicle: House prices rising in Atlanta
Hi there, and welcome to our first blog post! I want to start off on an issue that has been on the forefront of my mind for a while now. Seems like you can't turn on the news or read a paper these days without reading a headline implying that the sky is falling in regards to residential real estate. One must always remember the expression, "All real estate is local." There is a huge difference between the "bubble" markets of Florida, California, Las Vegas, etc., and Atlanta ... especially Intown Atlanta!
Image: Atlanta is in hunter green, near the bottom. Click for larger view.
First of all, Atlanta is not a "bubble" market. We did not have the "irrational exuberance" indicated by a huge run-up in prices over a short period of time. Since we didn't have a bubble, there's no bubble to burst! Sure, sales have slowed down, but we are not seeing the decline in values that the bubble markets are seeing. Now, this is not to say that we can't have a decline in prices at some point in the future if, for example, the economy as a whole slips into recession. But if we do, it's not likely to be as bad as the aforementioned bubble markets.
Intown Atlanta is even more different! The suburban Atlanta real estate market is struggling a bit. It's all about supply and demand. Let's say you have a home to sell in your suburban neighborhood. Next door, a developer starts a new subdivision of 250 homes. There's 250 more homes on the market, adding to...