Lake Lanier's low water levels affect the lake home market!

Lake Lanier, one of the largest and most visited Army Corp lakes, is seeing lake home sales significantly decrease.

The 4th of July weekend traditionally brings out large numbers of boaters and families taking advantage of all of the recreation that the lake offers. Unfortunately Lake Lanier will have its lowest water level ever for the 4th of July holiday. Most boat ramps are closed and swimming areas resemble a desert. Add gas prices on the lake averaging $5.00 per gallon and you have all of the ingredients for a disappointingly slow weekend.

As the Atlanta metropolitan area continues to grow many people looked to Lake Lanier for second homes as well as primary housing with commutable access to Atlanta. Prices rose much higher than the Atlanta area.

We are now in the second year of this down market. The Atlanta area has felt the effects but not on the level of other parts of the country.

Lake Lanier property has not seen the same pricing declines. However the number of houses sold has seen a dramatic change.

Jan 07-Jun 07 112 homes sold on Lake Lanier. Average price $643219
Jan 08-Jun 08 49 homes sold on Lake Lanier. Average price $642051.
As the level of the lake hit all time lows the real estate market has seen the effects.

Our observations:

Houses are marketed with boat slips. However there are no attached details on the water level under the dock
Sellers are forced to pull out their boat slips in order to find water. They are at their limits.
The second home market has seen a dramatic slowdown. Less buyers means a natural decrease in homes sold.
If your boat slip is not usable you are at a competitive disadvantage.
The lake does not seem poised for a recovery. The Atlanta area is in its second year of a drought. The lake water continues to be claimed by Georgia, Alabama, and Florida. The politics of the lake are not going to be resolved in the near future.
Our opinion:

If you live on the lake and do not need to sell sit tight. If you need to sell you need to be realistic about the external factors that effect your home. Remember the market dictates the price not your personal opinion.

We will see you out on the lake.

Randy and Barb

The Wells Team

The Norton Agency

The Usual "Spring Rush" Has Already Slowed

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

North Georgia sees the return of the "tire kickers"

The first two months of 2008 have seen a slight increase in real estate traffic. Unfortunately the majority of these buyers are more "tire kickers" than serious buyers. They are discretionary buyers that spend their weekends looking at houses. They continue to procrastinate in search of the perfect house at the perfect price. Advice to this group: THE DEALS WILL NOT BE HERE FOREVER. THE OPPORTUNITIES HAVE NEVER BEEN BETTER!

At the same time the Atlanta area is a unique real estate market:

Prices were up 4% in 2007
Atlanta is #5 in the country for job growth. 60000 jobs were created in 2007
People continue to move here from around the country. As they arrive their parents follow.
New home starts have dropped. This in combination with expired and withdrawn listings could
create a decrease in inventory of houses.

IF YOU WANT TO BUY YOU HAVE THE OPPORTUNITY OF A LIFETIME!

See our listings in the North Atlanta area at our website: http://www.randywellsteam.com/

Remember: Nobody knows your home like a neighbor. We are your neighbors the Wells Team