Traditionally this is our busiest time of year in the North Metro Atlanta/Norton Georgia area! Unfortunately the "rush" has appeared to subside.
The spring has been glorious in the Norton Georgia mountains which usually brings out those lookers/potential homebuyers. Our open houses would historically bring in 10-12 people on any given Sunday. This year we average 2-4!
Why the slow down this spring and the continuing slowdown in the Atlanta area market?
According to the President of the Norton Agency, Frank Norton Jr:
Causes of Pent-Up Demand
- Fear
- Trouble selling existing house
- Trouble obtaining a mortgage
- Affordability
Fear-Our current clients, and potential clients, are concerned about the Presidential election, gas and food prices, additional inflation, and what they see on the news daily. They are truly scared about what they perceive is actually happening.
Trouble selling existing house-According to statistics given to us by The Norton Agency:
- 17 month supply of houses in North Fulton County, 12.2 in Dawson County, and 9.9 in Forsyth County (counties north of downtown Atlanta)
- Closings in the Atlanta area are down 21% from 1Q 2007
- Inventory of housing is up 12.9% from 1Q 2007
- Closings in North Fulton County down 17%, Dawson County down 33%, and Forsyth 17%. This is 1st Q08 vs 1stQ 07
Trouble obtaining mortgage-We have lost buyers in the sub $150000 price range. Why? Because of low credit score! The lenders are also requiring proof of employment and salary. Mortgage rates are still good with the nationwide average 30 year fixed at 5.86%
Affordability
A recent editorial in the Wall Street Journal addressed this point. Written by Mr. Moulle-Berteaux, Managing Partner of Traxis Partners LP, a hedge fund, he simplifies the housing "crisis" to two items. One is supply and demand and the other is affordability. He states that in the 1990's housing consumed 19% of the montly budget. By 2005 that number went to 25%! For first time home buyers that number reached 37%! Put that together with food, gas, and inflation, and people get knocked out of the market!
The Wells Team, of The Norton Agency, has continued to market our properties everywhere possible. Our houses have more exposure this year than last year. Unfortunately there is so much available that it makes it difficult to differentiate our houses from the rest.
We continue to emphasize 3 points to our listing clients: Condition, location, and price. All of our houses are great with the first two items. Price seems to be the only item that you can make a significant difference. Some have responded with drastic price cuts while others are "holding the line".
Conclusion:
- If you do not need to sell your house keep it off of the market
- If you need to sell now you have to price your house aggresively. You can make up for the lower price when you get a good deal on the next house
- If you keep your house price "fairly" then be prepared to sit. Be patient and do not blame your agent for the situation
- Atlanta is #5 in the country for job growth. The area will continue to grow and eventually housing demand will catch up with supply.
- This could be the best market for buyers in the next 5 to 10 years. If you continue to procrastinate then you will miss out. We feel that prices have bottomed out.
THE MOST HOME YOU CAN BUY IN THE LAST FIVE YEARS AND IN THE NEXT FIVE IS RIGHT NOW! (According to Frank Norton Jr)
If you are looking for a house in the North Atlanta/Lake Lanier, Georgia Mountains area, look us up!
The Wells Team
Randy, Barb, and Sue
www.randywellsteam.com
