I have just completed compiling second quarter market statistics for the Metro Atlanta area and it seems that there is some positive news for a change, well, at least for the moment. When comparing the first and second quarters of 2008, the entire Metro Atlanta area saw an 8% increase in the number of homes sold and a 4% increase in price. There are currently 18 months of inventory.
Within Metro Atlanta, markets vary. For example, Alpharetta saw an 18% increase in the number of homes sold and a 2% increase in price (with 14 months of inventory) while lake front properties on Lake Lanier saw a 10% decrease in the number of homes sold and a 9% decrease in price. There are currently almost 44 months of inventory (down from 48 months only a couple of months ago). Optimism should be guarded, however. This is typically one of the busiest times for real estate in Atlanta and with oil prices and the number of foreclosures rising, we are likely to see a slower summer and fall. Additionally, although the number of homes sold has increased in many areas, this number is still less when compared to the second quarter of 2007, and prices, in general, are lower as well. As always feel free to call or email if you'd like to know how your town or community is doing.
It seems that the "perfect storm" hit Lake Lanier last year. First, were the effects of a two year drought which not only left little recreational water but almost left the city of Atlanta without drinking water (oh, those endangered mussels in Apalachicola are special creatures). Then to make matters worse, the mortgage "crisis" hit. The good news is that lake levels are rising (although still a far cry from full pool) and prices for lake front homes for the first quarter of 2008 were, on average, 2.5% higher than the first quarter of 2007!
The Metro Atlanta market has seen declines in both the number of homes sold and the average sales price for the first quarter of 2008. When comparing the first quarter of 2008 with the first quarter of 2007, 35% fewer homes have sold and the average sales price has decreased 4.4%. There are currently 18 months of inventory. The sub-markets of Atlanta vary, so it's important to get information on your specific area, county, and even subdivision. For example, the North Fulton area of Atlanta which includes Roswell and Alpharetta saw a 45% decrease in the number of homes sold but only a 2.2% decrease in sales price. Inventory is currently less than 18 months. If you're wondering about your current market conditions, call or email for a complete report.
First Quarter Market Report for Western North Carolina
Although North Carolina has not been as hard hit as many areas of the country, it is definitely feeling the effects of the credit crunch, weakened consumer confidence, and the struggles affecting the mortgage industry and investment banks. Western North Carolina continues to see a high volume of inventory and a decrease in the number of homes sold. As a result, sales prices have also dropped somewhat when compared to this same time period a year ago. Haywood County, which includes Waynesville, Maggie Valley, and the surrounding areas, saw a 38% decrease in the number of homes sold and a 3.3% decrease in the average sales price compared to the first quarter of 2007. There is currently a 27 month supply of inventory. Buncombe County, which includes Asheville and its' surrounding areas, saw a 25% decrease in the number of homes sold while the average sales price decreased 5%. Currently there is a 15 month supply of inventory. In both areas, homes that show well and are priced well continue to sell.
According to Lawrence Yun, chief economist for the National Association of Realtors, the number of existing homes for sale is expected to remain stable through the first half of the year with a gradual rise in home sales expected for the second half of the year. His forecast is based on several factors. The Pending Homes Sales Index, an indicator of future closed sales, remained stable in January. Higher loan limits for FHA and conventional loans will provide greater access to lower interest rates. FHA loan limits have increased in the Metro Atlanta area to $346,250 and in the Western North Carolina area including Haywood and Buncombe counties to $303,750. Additionally, conventional interest rates are expected to hover around 5.8% through the remainder of the year with a gradual increase in 2009.
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Unfortunately, Atlanta was not immune to the housing woes of 2007. The Metro Atlanta area saw record foreclosures and a 16.2% decline in the total number of single family homes sold. Since 1996, we have never seen a decline in the number of homes sold! The average sales price, however, increased 2%. Economists and real estate analysts are predicting a stronger 2008 for metro areas such as Atlanta due to pent up demand and strong job and income growth. For the last two years, job and income gains have risen solidly while home sales have been falling. According to Lawrence Yun, chief economist for the National Association of Realtors, these gains should have translated into approximately 2 million new homes. Instead, there were only about 600,000. Additionally, housing affordability has increased. Prices are dropping, jobs are growing, and mortgage rates are low. Personally, I have been encouraged by the increase in buyers in my new home community as well as increased traffic and interest in second home markets.
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