ATLANTA – After several years of inactivity, the real estate market is back on track with more listings and confident buyers.
The market is seeing significant recovery as the season transitions from spring to summer, when more listings tend to sell.
Robert Aiken, senior vice president and managing broker with Harry Norman Realtors, has been in the business for 35 years and has seen the market dip and rise from many different economic, demographic and sociological factors.
“I can tell you that it is completely different than it has been over the last five years,” Aiken said. “Every single type of property has increased; land sales have increased tenfold, people are actually buying land so that seven years from now they can build a house on it for after their kids get out of college.”
The recent turnaround has come from a series of suitable conditions in the Forsyth County area, Aiken said.
As the 13th wealthiest county, according to Forbes, Forsyth County is now thriving from expanding corporate and regional headquarters built up in the '80s and '90s that have provided the area with people who qualified for mortgages.
“If you price a house right, you can sell it,” Aiken said. “That’s not the way it was two years ago.”
In addition to the attraction of corporations to the area, Paula Van Sickle, a real estate sales professional with Keller Williams Realty in the North Fulton and Gwinnett area attributes the local boom to the cities' excellent quality of life, relatively low cost of living and close proximity to Lake Lanier and North Georgia Mountains.
Alpharetta is the sixth-fastest growing city in the nation, according to the U.S. Census Bureau.
Rhonda Duffy, broker and owner of Duffy Realty, recalls a period in 2007 before the crash when the metro Atlanta market experienced a record high of 110,000 homes for sale, a level that even forced Metro Brokers to switch their sign on Interstate 75 and I-85 from an analog system to digital because the number surpassed the five digit limit.
“Ever since then we’ve slowly gone down to where we’ve been for the last two or three years which is 36,000 homes,” Duffy said. “When interest rates go down like that and then they start to pick up again, it starts to freak buyers out.”
The averages sales price for Harry Norman Realtors is now about $350,000, Aiken said. One year ago, it was about $250,000, a change that correlates with an increase in the volume of listings.
This has created a new problem with the supply of real estate available.
“Every time something happens, some problem is created,” Aiken said. “Before you had so much inventory that you couldn’t get what they were worth, then people were underwater. Now they’re not underwater, now they can sell them, but they want more for them than they’re worth.”
This shift in inventory often results in bidding wars with over-confident sellers that raise prices above what the property is really worth, Aiken said. This may prevent the transaction from receiving an appraisal, which in turn denies potential buyers the opportunity to get loans.
James Stephens, property and real estate appraiser with J.P. Stephens and Associates says the home appraisal problem relates to a large influx of investors that feel like the time is right for buying.
“I think what you’re seeing in a lot of different markets in the metro Atlanta area is a shortage of available homes compared to years past,” Stephens said. “Prices are appreciating rapidly and previous homes sales that have happened earlier this year don’t really reflect the current pricing.”
Stephens said because appraisals use previously sold homes as a comparative basis, the rapidly changing market makes it hard to accurately appraise.
The changes in the housing market indicate a broader movement out of the nation’s economic recession.
“Even the investors are so freaked now because they realize that our market is re-establishing itself and that those times are ending,” Duffy said. “It’s been very exciting for the seller who has wanted to sell his property for a long time and didn’t feel like he could.”
Home prices nationwide rose nearly six percent last year, according a June report from The Norton Agency.
In the U.S. National Home Price Index, 20 major U.S. cities including Atlanta showed increases on an annual basis for at least three consecutive months in 2013, according to S&P/Case-Shiller.
As of the first quarter of 2013, average home prices across the country are back at their mid-2003 levels, the report states.
“Wherever the bottom was, we’ve passed through it,” Aiken said. “All of the ingredients for recovery are in place. People are hiring, building, listing, and the one key ingredient always is consumer confidence.”