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Atlanta Real Estate Market Update
By Ryan Ward | March 7, 2008
Atlanta real estate is comprised of a diverse group of cities in a number of counties, depending on who you ask, it’s between 10-14 and that number is continuing to grow as the popluation of the Metro Atlanta area grows. So to look at the numbers I’m going to provide and think that they will apply to a specific scenario with you and your home would be the wrong way to interpret the numbers. Instead, numbers from Atlanta should be used to give you a baseline from which to judge your more specific area. This graph shows active and sold statistics of single family homes going back to June of 2007. A quick glance at the data looks to show a declining inventory as well as declining sales, but, there is a statistics that is not really talked about much that I think is very revealing. I don’t claim to have made up this statistic, I’ve just not seen it used very often:
The percentage of sales compared with the number of actives available to buy.
Inventory has not changed too much and remains in the 50,000 plus units. However, sales have changed from over 5,000/month to less than 3,000. So, inventory change compared to sold homes change is significant and drastic. During June, which is typically the busiest month of the year for sales, you can see that about 9.5% of the inventory was selling. To look at the most recent month of complete data, about 5.3% of the active inventory sold.
This chart illustrates some of the difficulties sellers are having in today’s market. It’s more than just lower sales and more inventory. It is also that it is simply less likely that homes sell from a percentage of inventory basis. This leads to longer average days on market and as a result a continued high inventory level because as new homes come on the market, others remain that in the past would have sold. It’s a cycle that can only be broken by an increase in sales.
In my opinion, it is unlikely that we will see an increase in sales until we see a reduction in prices. I’ll put together a chart revealing what has been happening with prices as soon as I have some time.
Topics: Atlanta Real Estate |
March 7th, 2008 at 4:21 pm
Looks like your market is going to need very serious sellers who really want and in some cases need to sell. Also the demand for agents who know how to market and “sell” the properties they have in inventory (like yourself) will become in much greater demand. In Tucson this same type of market shift started about 18 months ago and now sellers are looking for the most capable and skilled agents in the marketplace to sell properties. Not many are taking chances on relatives and friends who “just got into real estate recently” most are going to top listers and at least hearing what they have to say before going with anyone else.
March 9th, 2008 at 10:12 pm
It seems to me that there’s a much more substantial level of denial amongst Atlanta sellers. Rather than drop their prices 5-10% as the market seems to be dictating, they’re either taking their homes off the market or just letting them sit and hoping to wait it out. This prevents the market from truly “correcting” and is going to be a harder drop as more distressed properties come on the market this year. Looking forward to your analysis on prices too, Ryan!
March 10th, 2008 at 8:38 am
Tho other thing that I see a lot of are properties where the seller has not really prepared their home very well to sell in this type of market. The sellers that do prepare their homes well stand a much greater chance of selling. I showed 7 homes yesterday to a couple in Roswell/Alpharetta just under $300,000 and none of these homes should have been on the market in the condition that they were in - at least at the prices they were listed for and that was not just my opinion, but, that of the buyers as well. Seller’s will need to wise up if they are really interested in selling.
March 11th, 2008 at 1:22 am
I agree, the main complaint or suggestion that I hear from real estate agents is that sellers need to price their homes for the this market and not a market we had years ago.
In addition, as you mentioned above, homes need to be prepped better today than in past years as there are just too many choices for buyers.
If you want to sell your home it needs to be priced right and ready to compete in a market full of great choices.
March 16th, 2008 at 2:54 pm
I am surprised by the number of houses that seem pretty messy. What surprises me more is when I call to see a property and the owner responds with “today is a bad day can you come back in a few days”. Some sellers really dont want to sell their homes it seems like.
March 17th, 2008 at 10:48 am
Gotta love the folks who have their homes listed and can’t find time to have people show it. If you aren’t motivated right now, you are not going to sell and tyou are absolutely correct; it’s unbelievable how people have their homes on the market in disrepair and expect it to sell for market value of a listing that is in excellent condition. This is not the time to ‘test the waters’ with an overpriced listing.
March 18th, 2008 at 9:06 am
Great food for thought Ryan.
I’m about ready to publish a chart on my site concerning the foreclosure rate over the last four years. I would be curious to see how it dovetails in with your chart over the same period of time.
From our collective experience, I bet we would end up agreeing that this data, while somewhat alarming, is also expected in today’s market. Let’s see what June 08 has to offer before making too many more predictions.
March 18th, 2008 at 12:37 pm
I agree with Jayson, if you want to sell then you need to price accordingly. Until the financial markets get straightened out and loans are realistically being passed out to deserving buyers sales will be flat.
March 18th, 2008 at 5:31 pm
David,
Please post a link back to it from here when you get it up…
March 19th, 2008 at 9:16 pm
Ryan;
Click on my name to go to the page then scroll just a bit down. If there is a better way to link to it, by all means, make the edit. Anyway, I inserted it as a gif file so it is a bit hard to read. Even so, I have no doubt the message will get across. It looks bad, but there is undoubtedly a lot of opportunity for the ready investor.
March 19th, 2008 at 10:29 pm
Your name works fine. it’s a clean link to your page. I wish I could read the numbers a bit better…
You are doing good work with that page:
“This paragraph was written because an internet search on avoiding foreclosure revealed multiple scam websites designed to rip off desperate homeowners. They provide compelling but false information on how to beat the system. Don’t do this to yourself and your family. If you are unable to pay the mortgage, then you are already in a tough situation.”
I’m changing your name to anchor text as a link. Let me know if I can help getting a clean jpg or png of that graph.
March 19th, 2008 at 10:32 pm
Not only are there very good opportunities for investors…with proper consultation from someone like yourself, you might be able to help some people get out of a bad situation.
Getting the message out is difficult. There have been a few very good signals in the market with Fannie and Freddie increases as well as the buyout yesterday.
March 21st, 2008 at 2:25 pm
I’ll agree with Ryan and say that the investment opportunities are bountiful. I also think that home prices will continue to fall in line with the market-as homeowners appear to over-valuing their homes-creating an even better environment for those who have some cash to put up front. Needless to say, this spring/summer should be very interesting.
March 22nd, 2008 at 9:14 am
After reading this article i had become a great fan of your’s and needless to say this article was a real eye opener for all those who are in this business and for all those who wish to enter this field.