AJC Home Sales Report: No telling when we’ll hit bottom

The AJC began a realistic presentation of the Atlanta real estate market in a two part series they call the AJC Home Sales Report. You should read the whole thing here.

Some highlights include:

Our annual analysis tracks the sales of 43,000 houses in metro Atlanta in 2010, and the trend is still going in the same depressing direction.

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Analysis from this year’s Atlanta Journal-Constitution Home Sales Report reveals that home values in metro Atlanta remain locked in a four-year slide as the pace of home sales sputtered. Five thousand fewer homes sold in nine metro counties last year than in 2009, accounting for a 9 percent drop. Those that did sell went for less than in 2009: Home prices fell 4.5 percent last year.

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Homes in the northern suburbs sold at a faster pace than other areas, though suburban home values continued to slide. Cherokee, Cobb, Forsyth and Gwinnett had increases in the number of existing homes sold. But prices decreased 17 percent to $126,500 in Cobb’s 30067; 11 percent to $135,250 around Woodstock in Cherokee’s 30188; and 15.8 percent to $80,000 around Norcross in Gwinnett’s 30071.

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The report, along with interviews with dozens of buyers, sellers, agents and experts, paints an uneven picture of the market. This much, however, is clear: Metro Atlanta’s housing market remains a big gamble.

This is a far cry from seven years ago when home sales began to increase 10 percent a year while median home prices grew about 5 percent a year. That ended in 2007, when home prices in the 20-county region went flat and home sales fell 22.3 percent.

I would love to tell friends and clients that the real estate has hit bottom and everything will be rosy from here on out but that simply isn’t the case. There are still too many foreclosure and short sale properties on the market with more in the pipeline for the market to stabilize.

Is it a good time to buy a home? Yes. If you need or want to buy a home and are in the financial position to do so this is a great time to buy and there are some incredible deals out there. But don’t let anyone tell you that the overall real estate market has hit bottom or is even close to doing so… yet.

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5 thoughts on “AJC Home Sales Report: No telling when we’ll hit bottom

  1. Jim, I saw that report too. But remember, even metro Atlanta stats can be misleading. City of Atlanta school issues, Clayton County propblem. Gwinnett and Pauling county hammered.

    So, I ran the average sales price in 30004 for Jan 1st – May 31st and compared 2010 vs 2011. Average sales price is up for that period by 6.7% in 30004.

    I agree that some areas haven’t seen the bottom yet but I really believe that we have seen the bottom in North Fulton {he says while not wearing rose colored glasses 😉 }

    • Bob- I never meant to insinuate that all areas were affected the same nor do I dispute that the average sales price in Milton may be higher this year than last but that certainly doesn’t mean that homes in Milton are worth more this year than last. The increase in average sales price is a function of more expensive homes selling but that doesn’t mean they are selling for more.

      Higher average sales prices just means that higher priced homes are finally being priced to sell. What I have seen in North Fulton this year is that many higher priced foreclosures and short sales are finally selling at lower prices and the motivated homeowners in that price range are finally having to price their homes accordingly to sell.

      For example, I find 7 homes priced over 1 million dollars that sold in the 30004 zip code this year as opposed to 5 that sold in that price range in 2010. The higher number of million dollar sales raises the average sales price but it doesn’t mean the homes were selling for more than the year before. If you look at the most expensive home it was actually listed for sale at $2.5 million for most of 2010 but didn’t sell until the owners accepted $700,000 less in 2011.

      I appreciate your continued optimism and the Alpharetta/Milton area has certainly fared better than most of metro Atlanta but I still see nothing to indicate our prices have stabilized… yet.

  2. Hi Jim! Thanks so much for posting my story to your blog. It was a fascinating experience to delve into the data. The data is a bit difficult to draw conclusions from,m in that it uses median home prices. So everything is based upon the set of homes that sold in a particular year — which is never apples to apples. Still, it’s the best set of data we can find (that we don’t prepare ourselves). We buy it from SmartNumbers, a firm in Marietta.

    To your and Bob’s point, we definitely saw some optimism in some ZIP codes — Alpharetta did fairly well, Vinings did well, intown Atlanta did well. The ZIP codes with the best schools and housing near business centers did best. But a lot of ZIP codes — especially South Fulton, areas around Tucker, and parts of Cobb — didn’t do so well. It is a mixed bag. But citywide, the numbers were all down. We all know that real estate is all about local, local, local!

    Thanks for reading. Any and all comments are welcome. You can reach me at rtobin@ajc.com.

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