Real Estate Market
April 22 2020 Market Update
COVID-19 Affect on the Atlanta Real Estate Market April 1-7
Full Transcript Here:
We're certainly all in unique times and the real estate market is not immune to the changes happening around us. Many buyers think now is the time to make low offers and many sellers are waiting on the sidelines - for the "right time" to list their home. In the meantime, the market is moving along - faster than you might think. I'm Ryan Ward with PARE and I'm going look at the numbers and see if we can get a little perspective on all of this in just about 2 minutes!
If you have any questions, please call, text me or drop a comment below...
For now, let’s compare last week to the same week one year ago and see what we find. I’ve used homes between $100,000 and $1,000,000 for this.
Last week, 1,203 houses went under contract and last year, 1,643 homes did. That’s a drop of 26% from last year and a smaller drop than the drop for new listings. The pending to active ratio, which we use as a leading indicator is 75% now and 74% last year. More good news.
Fewer pending sales should be expected during this time. However, since fewer new listings are entering the market than are selling, inventory is actually reducing. To further help keep the supply in check, more homes are coming off the market than last year as well. Last week there were 648 withdrawn and expired listings. Last year at the same time there were 434. More good news. New listings - pending sales...
Atlanta Supply & Demand During Covid-19
What Does The Market Look Like Today?
Martin's Landing Market Minute, February 2019
It's no secret that the overall real estate market slowed last fall on a national and local level. However, the market in Roswell and specifically at a hyperlocal level in Martin's Landing remains extremely strong. There are 15 homes for sale in Martin's Landing right now (February 8th) and of those 15 homes, 7 are under contract! Keep in mind also that January and February are the slowest months of the year...
Two January Sales in Martin's Landing
Last year in January, 8 homes sold and while this year's number looks low, there were only 3 sales in February last year. Based on current pending sales, we will double or triple that this February. The January 2019 sales in Martin's landing were 11200 Martin Ridge Rd for $308,000 and 100 N Pond Ct for $242,000. Another home, 360 Spring Lake, was scheduled to close January 31st and it hasn't updated in the system yet. I'm not sure if it closed or had the closing pushed out a few days. I'll report it next month either way...
Martin's Landing Real Estate Agent
If you are ready to sell your home in Martin's Landing, contact us. The first step typically starts with getting an idea of what your home will sell for in today's market followed by finding out what marketing techniques will get your home sold for the most amount of money in the least amount of time. Fill out the form below or give us a call for a no-obligation consultation.
What's The Real Story? It's Probably Pricing!
Time and again, I come across a home listing that is well kept, with awesome features, in a great neighborhood... but it just isn't selling.
Buyers will ask, "why has is been on the market so long?" Sellers will ask, "why isn't my house selling?"
And the answer is usually: PRICE.
My job, as your highly skilled real estate professional, is to do the research and give you the tools and information to price your home properly, or to make the appropriate offer on a property. To get that information, I look at factors such as style, size, features, geographic location, schools, etc. in comparison to comparable recently sold (in the last 3 - 6 months) properties. I don't set the price - you don't set the price - THE MARKET SETS THE PRICE.
The goal is to sell the property in the least amount of time for the most money. And your pricing strategy will have a direct effect on your success of selling for the most money in the least amount of time. Statistics show that if you price your property too high, you risk sitting on the market for months. And in the end, you will probably be selling for less than if you priced properly from the beginning, because you will need to do price reductions to offset the perception that there is something wrong with the property. Price your property too low, and you aren't maximizing the potential profit from the sale - and the bidding war you hoped to achieve may never materialize.
Take a look at the snapshot below which demonstrates the effect price has on sales vs. listing price and days on market. Getting the price right from the beginning, is your best bet for selling your home for the most amount of money in the least amount of time.
Are you ready to have a chat about selling your home? I would love to meet with...
A Tale of Two Markets - Don't Be Fooled!
If you watch the news, read Facebook or know a real estate agent, you've probably heard abut how amazing this real estate market is and how much prices have gone up and it's a great time to sell. Did you also know that certain segments of the market are actually far more favorable to buyers than to sellers? Read on to learn what's really going on in the market...
The market really is actually split into two segments. For one segment, it's a sellers market and for the other, well, it's a buyers market. Do you know which is which?
There is a natural break in the real estate around the $500,000 home price mark. In large part this is because conventional financing in Atlanta goes up to $424,100. If you want to buy a $500,000 home and avoid a jumbo loan with higher rates, you need to put down $75,900 plus you need money for closing costs. This generally means that buyers must have a 20% down payment for loans on purchases over $500,000 and that limits the number of buyers and therefore demand and therefore prices.
The difference between the $500,000 and below market is staggeringly different from the $500,000 and up market. I'll show you 3 different markets in Metro Atlanta that point to this difference and if you jump into this market as a consumer, you need to be armed with this information because it could cost or make you 10's of thousands of dollars.
Point to Remember: If there are less than 6 months of inventory of homes, it is a sellers market and above 6 months of inventory it is a buyers market.
In North Fulton, it is a very strong sellers market below $500,000 and a buyers market for homes above $500,000. Let's look at the numbers:
- Active listings - 335 homes
Willow Springs in Roswell - Market Update
Willow Springs is one of the largest and most popular neighborhoods in Roswell. It consists of approximately 680 homes and is also home to the Country Club of Roswell. Sales in Willow Springs are historically high for a number of reasons including the location and proximity to Georgia 400, shopping, dining as well as NorthPoint Mall and Avalon.
Willow Springs Market Update
This year (as of this writing in November) there have been 35 sales in Willow Springs. The most expensive sale was $750,000 and the least expensive sale was $278,000 so home prices, depending on style and location within the neighborhood vary with options for most buyers looking for the lifestyle offered in Willow Springs. Here are the statistics for Willow Springs
- There are currently 13 homes for sale
- There 8 additional homes under contract
- The average price for sales is $452,404
- The average days in market for homes to sell is 60 days, but for those home which were priced correctly and did not require a price reduction the days on market dropped to 39
- The median days on market, where half the homes took longer and half the homes sold faster is 29
- The median sales price is $410,000 where half the homes sold for more and half the homes sold for less
- The original list price to sold price is 95.46% for all homes sold and the list price to sold price for homes priced correctly was 97.89%
Compared to Roswell in the Same Area
When we compare Willow Springs to Roswell in the same are and price range you can get a feel for how it stacks up to surrounding neighborhoods. There are of course, other factors besides just the statistics that come into play but it still gives a baseline for comparison.
In this area of Roswell...
Alpharetta Market Update - Things are Changing...
Summer is over and school has started and that means we run into the beginning of the fall cycle of slower home sales through November and the typical uptick in December before the slowest two months of January and February. Inventory is still very low and fully one third of all homes currently listed for sale are under contract but change is coming - it's just a matter of when we see a change and no longer if we see it.
Check out the infographic below for the big numbers:
What Does This Mean?
I don't think I would read too much into the slower sales for a couple of reasons. First, most new home sales are not accounted for in any database so it's difficult to get a totally clean number. Second, even if we do see a little slowdown in the sales, there still isn't enough inventory to drag us into a buyers market. At least not yet. There are of grumblings from buyers about homes being priced too high in their opinions and as an agent, I would agree with certain homes but that's anecdotal and not marked by any substantial evidence. to the contrary, we still see very low days on market for homes that are updated well and priced accurately. There is no shortage of buyers just a shortage of good homes.
When the market does shift, I wouldn't expect any change until the fall of 2017 at the earliest in Alpharetta and when it does if there is a price correction it would be my best guess that we may see a small, 4%-5% downturn in prices that won't last long as long as nothing radically changes in the overall economy.
Questions or Comments?
As always, we welcome feedback as long as it's respectful. Leave a reply below!...
Roses are Red, Violets are Blue, Houses are Beautiful But Not in That Hue!
As a homeowner, real estate agent and a potential homebuyer in the coming months I've come across some extreme examples of what not to do with paint when you have your home for sale. First I would say that what people do inside of their homes really is their business. We all have different tastes and colors we prefer and we often use our home as a primary tool to express those tastes. However, when you make a decision to sell your home and the interior photos are out there for world to see and you are trying to make a great impression on a potential buyer, there are some things that you should never overlook. Bold color is at the top of that list because it's impossible to ignore.
If you want your bedroom painted a soft red/pinkish color, by all means slap some paint up on the walls and enjoy it for all that it's worth to you. But seriously, don't post a photo of it online as part of a commodity for sale that costs hundreds of thousands of dollars. It's going to immediately cause an objection and will certainly leave some buyers flipping to the next listing without even giving your home a chance. Here's an example I came across this morning. I'm sure they love it and that's fantastic. But now they want to sell it and it's a great example of how to list a home and not sell it:
The number of people looking for a home that matches this criteria and price that want their bedroom painted this color in the city you live in and in the location you live in and the price your home is for sale for is zero. This really needs to be painted neutral.
Here's a kitchen - please overlook the clutter momentary (if that's possible and could be another ranting blog posts about what sellers aren't doing that they should be) - can we call this one the Christmas kitchen? How could a buyer possibly make sense of what it would be like...
Ranch Homes Near Downtown Alpharetta are Sizzling Hot!
It's true that the real estate market in the general vicinity of Downtown Alpharetta is about as strong as anywhere in Atlanta right now but the market for ranch homes near downtown is particularly strong. There are a number of reasons that make this submarket of homes particularly hot...
Walk to Downtown Alpharetta
If you haven't been through Downtown Alpharetta recently you've missed a considerable transformation. A ride down Academy Street or Cumming Street off of Main Street or even up Canton Street parallel to Main Street is showing some big transformations and that's due in large part to the proximity to all that Alpharetta has brought into the downtown area. There is something going on every weekend and Thursday nights and to be able to walk to the events is a huge selling point - it's what every suburban city is trying to achieve but Alpharetta has accomplished this in a way that many other areas have not yet been able to do and because it's Alpharetta, it makes the area all the more in demand.
Home prices in Alpharetta are as high and demand for the area is strong. To find a renovated ranch home for under $400,000 is an attractive option. New construction starts in the $600,000's and that's just simply out of reach for most homeowners. I think the days of huge homes as status symbols is winding down and people are more interested in lifestyle than 5,000 square foot homes that do nothing but collect dust. It's a more practical approach to home ownership and quite frankly, I welcome it!
You know the saying - they don't build them like they used to...well, I don't necessarily agree in terms of construction quality but they certainly don't give you lots like they used to. Most of the ranch homes in Downtown Alpharetta are older neighborhoods from the 1960's and 1970's and they have wonderfully large and level lots perfect for pools (which you might be able to afford since you aren't buying an $800,000...
Highland Park in Johns Creek
Highland Park Entrance
Highland Park is one of the hottest neighborhoods in Johns Creek and has been for quite some time. Home prices in Highland Park hover right around the average price for all homes in Johns Creek, but the location, to the west side of Johns Creek gives homeowners a little easier access to Georgia 400 than many other neighborhoods and that shorter commute.
In 2015, only 6 homes came on the market in Highland Park and they sold very quickly. The average days on market was 24 days and that was brought up by one home that was initially overpriced and then reduced. Once it was priced correctly, it sold in about 20 days also. What this means is that the average days on the market for the neighborhood is really about 18 days! The most recent home to come on the market was only on the market for 3 days.
Map to Highland Park
With a convenient location to GA 400 and homes that sell quickly, if you are looking for a home in Johns Creek, check out the homes for sale in Highland Park or you can use this link to check out all of the homes for sale in Johns Creek....
How to Win if You Are Buying in This Market
If there is one thing we are hearing consistently it's that there aren't enough homes on the market - or - that buyers feel like homes are overpriced. You know what? It's the same thing just coming at it from different angles.
Really, it's this: there aren't enough homes to fulfill the needs of the true buyers that are earnestly looking to buy a home. That means sellers can get more for their homes than buyers think they should which makes them APPEAR to be overpriced to buyers who haven't quite accepted the new realities of the market (that's most buyers). It's old news to those of us in the business working with buyers...
First, we tell them that the market has changed, then they find a house they want to buy only to lose it to another buyer because they made a lower offer. It's likely the other buyer lost one too and finally realized they needed to listen to their agent!
Then, we can't find them another house for a month because inventory is so low that most buyers actually have very few homes to choose from.
So, How Do You Win if You Want to Buy in This Market?
Lots of homes are available to buy, but there is a general feeling from buyers in the market that homes are overpriced or they can't find what they want. You need to shift your thinking somewhat so that you are inline with the changing realities of the market if you want to win the best deal on your new home in this market.
Understand this is a Seller's Market
Unquestionably so! There are no more "deals" as defined by what we have seen in the past few years. If you want the new version of a deal, you need to understand what that looks like today.
This is a seller's market which is traditionally defined as any point where the supply of homes is under six months - what this means...
How to Determine Price Change as a Percentage
We here on the news or overhear from a real estate agent that "prices are up (or down) by some percent this year so it's "a great time to buy" or some other use of the percent change as it relates to some real estate statistic. What does it mean? How is that computed? Does it matter to me what happens to prices nationally when I want to buy a home in Atlanta or some other area?
If you are an agent and you work with clients, you can probably find some article that states these changes for you to quote. However, the real power of using percent change with your clients is when you are able to whip up these statistics in a much more meaningful way. If you are a buyer or seller, you better have an agent who knows how to whip these statistics up for you because it really doesn't matter what is happening overall in Atlanta or even in one of the suburbs like Alpharetta. They need to be able to tell you what is happening to comparable properties. That's where it really matters and those statistics are too in the weeds to find quoted my our professional organizations or even by local media. In any event, here is how you do it and why it is so powerful.
If you are a buyer or agent representing a buyer (works the same for sellers too) and you want to place an offer or list a home and one sold right down the street exactly the same as this one but it sold three months ago, how do you come up with a price for the home? Are prices rising or falling? By how much? Don't worry, it's not that hard to figure out. You just need to remember one simple phrase:
[New (Price) - Old (Price)] Divided by Old(Price) = Change
A little easier: new minus old divided by old
Let's take an example...
In some area, the average price for homes in June of last year was $325,000. This year in June, the average price...
Less Foreclosures in Alpharetta Means Less Downward Pressure on Prices
The number of foreclosure sales in Alpharetta in the last 60 days is down 84% from the same time last year. There have only been 6 foreclosure sales in the last 60 days of this year compared with 38 sales during the same period last year This is an amazing statistic if you think about it!
Foreclosures depress home prices because many buyers prefer them and appraisers use them as comparable sales to arrive at valuations for other homes. This is inline with what RealtyTrac reports nationally showing a 29% decline in Q3 of 2013 compared to Q3 of 2012 of foreclosure sales. Of course, foreclosures have always been below the national averages in Alpharetta, but with only 6 selling in the last 60 days, I believe we can make a few observations:
- With this few foreclosure sales, prices will not be pressured downward any longer. We've seen this trend happening for about 1 year and half, but these numbers really put the end to any further speculation.
- For buyers seeking a "deal", they are gone. It's time we now assess this market from the point of view of value again. Of course, you can still get a deal, but it's based on value, not price.
- For sellers, this is great news because buyers no longer have the low priced options they had in previous years so you will see more real buyers and few low ball offers. This should mean prices wil continue to rise (see Alpharetta home prices if you would like to know what your home is worth) provided the economy does not fall out from under us because of what is happening in Washington (I don't see tha happening).
Overall sales don't seem to be trending up from last year, but with supply so low due to fewer foreclosures and the lack of equity for traditional sellers, we remain in a sellers market. The caveat here is that...
The Market is Hot! Or is it???
Homes are selling in 3 days! Rates are going up! It's a great time to buy!!!
All three of those statements are generally true, but they don't really tell you what's going on in its entirety and they certainly don't give you enough information to make an informed decision. They are good talking points, but there is a lot more going on behind the scenes than these three statements make it out to be so I will try to address each one individually.
Homes are selling in 3 days - partially true. Some homes are selling in 3 days, but certainly not all of them. If your home is priced correctly for its condition and location, the average days on market is about 15 days. What's interesting about this is that it doesn't matter what price point we are talking about. In fact, it really doesn't matter which moment in time we are talking about either - even the worst part of the latest downturn in the market. In my view, this is really the first fundamental law of real estate (no, it isn't location because if it isn't priced right for it's condition, it won't sell). If there is a market for your home and it is priced correctly for its condition and location and marketed properly, it will sell in about 2 weeks. For homes between $500,000 and $1,000,000 it's about 21 days and for homes between $1,000,000 and $2,000,000 it's about 28 days and above that all bets are off because the actual market for these homes is quite small (except for Buckhead where the price may be closer to $3,000,000). The question really is what price will it sell for. See chart for more details about days on market. I see these charts every quarter and they just don't change.
Rates are going up - says who? Have you paid any attention to the economy lately? Unemployment is still high, especially...
Land Values Continue to Rise in North Fulton
Last October, I wrote that land values were on the rise in North Metro Atlanta and recent activity reinforces that article with more certainty. This is great news for all of us, but especially homeowners who had seen land values drop by about 40% from the highs of the market in 2007. This upward trend was inevitable, but it's been my experience recently with several other pieces of land available that many buyers are still quite reluctant to accept this upward trend as reality. I think there are a number of reasons for the uptick in values. What this means is that if you want to buy land, yesterday was better than today and tomorrow it will cost you more. This is irrefutable at this point and barring another major downturn (very unlikely), will in all likelihood continue. It does not mean however that your home is worth more - just the dirt underneath it. There are other factors in play affecting the values of the existing retail inventory of homes not the least of which is new construction.
Examples and Statistics
Earlier today, we closed on this 2.5 acre property with a small brick ranch that will be torn down on Hopewell just north of Redd for $140,000. That's a sale at 56K an acre for a property with frontage on a fairly busy road with a bit of road noise to boot. Couple that with the fact that a portion of the property was in a flood plain and it would be easy to make the case that an ideal setting would easily fetch over $70,000/acre in today's market. If that's not enough, there was another recent sale on Mid Broadwell that is even more exciting.
Mid Broadwell land sells for $84,000/acre
Land Values up in North Atlanta - Sales to Prove it!
Last Tuesday the bar was raised on the north side of town for land values with a sale that took place on Clarity Rd just across the border from Milton in Cherokee County. The $2,600,000 sale was a nice home, but it was the amount of land that sold with the home is what gets me excited. I've been in the home - I showed it to a buyer and the home with it's 33 acres represents the best sale this year to set a new floor for pricing in this market. based on the the size and quality of the home, the land would have had to be valued at or above $50,000/acre. Given its location in Cherokee County, this should set the prices higher for North Fulton for hopeful sellers.
- 6,100+ square feet according to the tax records
- Small Stable
- 2 ponds
- Numerous acres in the food plain
- 33 +/- acres
- List price - $2,900,000
- Sales price - $2,600,000
- On the market at that price for less than 30 days before going under contract
Spring Market Update for Metro Atlanta
The ups and downs (mostly downs) of the market are likely to continue, at least for most of this year and there is a good chance that the next six months will be the hardest summer selling season yet if you are a seller, but, the statistics are definitely showing some important and changing trends that you probably are not hearing about on the news. What we need to look at is one month from one year compared to the same month from a previous year. This counterbalances annual cycles like the ones that we have here in Atlanta. That's the case everywhere, but I digress. An increase in December over November is meaningless to the market as that is the case every year.
Below are a few sales graphs that I want to explain before you read them and then I'll add some further information below them. The first graph is all residential sales volume of single family homes by month. Below that is only new construction sales. The third is all non-new construction sales. Before you look at them, I want to explain why I did this. A few weeks ago, we had a presentation in our office explaining that the median price difference in Atlanta between new construction and similar resale homes was at an all time high of $122,000. This difference in afford ability has created a very interesting scenario in the real estate market in Atlanta that will begin playing out later this year and will mark the beginning of the end of the downturn locally unless something else terrible happens.
Remember this point for later: New construction cannot come down in price while resale home value can drop. It's going to be important to see what's happening in the market.
O.K., let's look at these graphs. The first is all residential single family sales in Metro Atlanta for 2007, 2008:
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