Archive for December, 2009
Alpharetta Real Estate for 2010: What will the future hold?
categories: Alpharetta Real Estate, Crabapple, Foreclosures, Local Market Conditions, Metro Atlanta Statistics, Milton Real Estate, New Construction
It’s a question buyers and sellers ask almost every day, especially in a market like this, but at the end of the year people look forward to that new beginning. For a brief period of time it’s like the slate gets wiped clean on January 1st. Anything is possible and we look for signs of what may come for Alpharetta real estate. I always say, in order to know where you’re going it helps to know where you’ve been. Looking back over 2009 might not be a pretty picture, depending on your perspective, but it’s telling.
Ouch : Sales declined through most of the year and Sellers really took it on the chin. And builders took it even harder. It’s tough to compete though when almost 40% of all homes being sold in the first 2 quarters were foreclosures or short sales. For those that could take less and get out, they didn’t like it but felt like they made it out. For others, they had to stay put or take a loss. Never before have I seen so many homes available to rent, which was a good alternative for many sellers out there that had to do something.
Cha-Ching : While Sellers were getting beat up, Buyers where cashing in. For those in a position to buy, the real estate deals were plenty and the banks had their shelves stocked with goods. First-time home buyers and renters were in the envious position of not needing to sell and having plenty to choose from. Still, competition was stiff for foreclosures. Banks started the year pricing at the old market value but later realized that aggressive list prices brought multiple offers fast and sales prices that were over list. They were still good deals but the time on market was reduced significantly. The tax credit did it’s job and continues to do so until it expires next year. Inventory levels were reduced quite a bit and now we are seeing an increase in homes sold year-over-year. Comparing November 2009 to November 2008, the number of homes sold in Metro Atlanta are up 52% and for North Fulton, they are up 82% .
Bye Bye: No, all the deals aren’t gone but they are slowly fading away. The expanded tax credit will continue to help but I’m seeing the mindset has changed with both buyers and sellers. At the beginning of the year Sellers were still amazed that a home reduced by $100K could still be on the market and Buyers were amazed it hadn’t been reduced more. Now sales prices have come down further, Sellers except much of the current pricing as market value and Buyers are not willing to spend months looking for that spectacular deal because they are slowly disappearing.
Looking Forward : We will see a higher than normal level of activity for the first 4 months while the tax credits are still in effect. This will help continue to reduce inventory levels and we will continue to see the number of home sold year-over-year go up. Sales prices will flatten out for most, and begin to increase in small pockets of demand and sought-after communities later in the year. The 400 corridor is well positioned with great schools and businesses that are still moving employees into the area.
New construction starts, which showed up in the 4th quarter of 2009 will widen through 2010 due to an abundance of developed lots at bargain prices. Forsyth County will lead the pack here, mainly because builders will be able to buy lots and build in lower price ranges to a greater degree than in North Fulton, but we’ll see that in North Fulton as well. Knight Construction is selling out in the Cumming community of Union Station, which is no surprise as first-time buyers typically gravitate towards new construction when it’s available. I suspect new homes in Crabapple and Milton will have the most opportunities.
Foreclosures will be present for the next couple of years (no surprise) but banks will continue to roll them out slowly keeping competition for them fairly high. Also, thanks to the banks, Short Sales will remain an excruciatingly painful and slow process (thank you Bank of America). Interest rates are anybody’s guess but until unemployment comes down to a respectable 7 or 8% then they will have to remain reasonably low.
How do I know it will all turn out this way? I have inside information that "It is decidedly so".
Posted by Bob Strader | Currently No Comments »
Do you believe?
categories: Alpharetta Real Estate
"It’s that time of year…" as Nancy Wilson sings in The Christmas Waltz. Christmas trees are on the tops of SUV’s all over Alpharetta and Milton; lights are shining on homes throughout many communities. While my 12 year old raises her eyes with that wise old look of experience when she hears her sister ask me if I believe in Santa, my 10 year old still adamantly insists he is real. I know she has friends telling her at school that there is no Santa. It’s the topic of discussion on the bus, but she is convinced - the evidence is clear to her. In fact, she is amazed that those kids at school don’t get it! Then she gives me the list of reasons…or proof, that Santa is real.
The funny thing is, when people ask me about the market and I tell them that we’re past the bottom and we will all see improvement next year; they raise their eyebrows and look at me as if to say "I don’t believe, I know better". Then, just like my daughter does, I start listing reasons why it’s clear we are heading out of our economic real estate woes. Don’t try to convince me otherwise, to me the evidence is clear.
Now, I will admit that the improvement is small and we’ve been beat up pretty badly by the recession so I understand why many people have a hard time believing. And we won’t be out of it overnight, but we are heading in the right direction…let me show you. Below is a chart comparing real estate sales for the last 4 months of 2008 to 2009, with the number for December 2009 being a current snapshot. One chart reflects sales of single family homes, the other townhomes/condos. Both for real estate sold in North Fulton, specifically Alpharetta, Milton, Roswell and Johns Creek.
| Units Sold in North Fulton (Alpharetta, Milton, Roswell & Johns Creek) | |||||||
| End of 2008 vs 2009 | |||||||
| Single Family Homes (Residential Detached) | |||||||
| SEPT | OCT | NOV | DEC | ||||
| Units Sold 2008 | 179 | 145 | 112 | 153 | |||
| Units Sold 2009 | 200 | 168 | 204 | 190* | |||
| change | 11.7% | 15.9% | 82.1% | 24.2% | |||
| Townhomes / Condos (Residential Attached) | |||||||
| SEPT | OCT | NOV | DEC | ||||
| Units Sold 2008 | 67 | 51 | 34 | 30 | |||
| Units Sold 2009 | 68 | 62 | 64 | 45* | |||
| change | 1.5% | 21.6% | 88.2% | 50.0% | |||
| * numbers for Dec 09 are closed and current pending sales | |||||||
These two charts show a clear trend of increased sales for both single family homes and townhomes / condos for the end of 2009 over the previous year. Is it simply market improvements? Is it a direct result of the home buyer tax credit? Are we seeing increased sales because prices have come down far enough for buyers to be willing to pull the trigger? I think it’s all three, but it certainly is an indication that we have seen our bottom and things are moving forward in a better direction.
It’s that time of year and we all need to believe. And like my daughter, I’m backing this belief up with some data…so don’t tell me you don’t believe because it’s true.
Posted by Bob Strader | Currently 1 Comment »
