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Case Shiller Index Reported May 2011

Tuesday, May 31st, 2011

The latest Case-Shiller Index was published on Tuesday, May 31st, 2011. As always, the index reports on data 60 days in arrears. Therefore, the index reports Metro Atlanta home values for March 2011. So what does the latest index show and what does that mean for home values in metro Atlanta?

Before we provide the answer, we want to make two caveats. First, the Case-Shiller index of home values is very different from average sale prices or median homes prices which only reflect what was actually sold in the market. If lower priced homes are selling more, then the average sales price will show a lower value than what market value may be for higher priced properties. According to SmartNumbers, almost 50% of 2011 closed sales are under $100,000 and the normal distribution would be in the 10-15% range. That skews the average sales price lower. The median price is simply the home sales price in the middle of the properties selected. The Case-Shiller Index reports on repeat properties sold and other factors which are generally better indicators of home values. Second, this index reflects the average home values for all of Metro Atlanta. Remember, people do not buy houses in America or even in metro Atlanta. They buy a specific property on a street in a local community. Real estate is local and every market is different. There are some local communities that have held their values reasonably well and others that may continue to decline. Your local agent expert can help you understand the specific metrics in your local market. However, the Case-Shiller Index is a good general indication on what is happening in our market.

Now for the news…. The March index continues an 8-month streak of falling home values. The current index reflects values similar to home values in October of 1999. But we are returning to a more normal seasonal pattern which tends to see home values rise in the spring and summer months with drops in the fall and winter. The March index is 98.36 which is 1.87% down from last month and 5.18% down from March of last year. The root causes for these results are the aggressive prices of short sales and foreclosures in our market plus overall concerns about the economy. Click on the link below to open the Excel spreadsheet that shows the details of the latest index.

Case Shiller Index Atlanta – March 2011 Index – Reported May 2011

The peak of our market was July of 2007 according to the Case-Shiller index. Since July of 2007, our homes values have slipped 27.93%. If you average the Case Shiller Index for the past 12 months, we are down 23.60% from the peak. We believe it is more effective to use the ”average of the past 12 months” or “trailing 12 months” as an indicator instead of reacting to a specific month.

The big factors to watch will be the pace of short sales and foreclosures entering the market and mortgage rates. Your local Prudential Georgia Realty agent can show you the specific trends in your local area for foreclosures, short sales and notices of default. Recently, we have seen mortgage rates dip back to historic lows again. That will not last long as virtually every analyst predicts rates to go higher in the future. There are major issues at stake including the future of Freddie & Fannie and proposed legislation for QRM (Qualified Residential Mortgages) that will require 20% or higher down payments and increase the costs to provide financing. Analysts also predict the demise of more exotic loan types like ARMs and interest-only loans. We will more likely see plain vanilla mortgages of 10, 20 and 30 years with a 20% down payment. This is all part of the financial reform legislation. Right now, there is an incredible window of opportunity to buy the home of your dreams and set a future mortgage rate that we will not likely see again in our lifetimes.

Remember, you will not know the bottom of the market until it is already passed. We believe that we are seeing the bottom of the market for Metro Atlanta now. Future demand for our housing is strong. The AJC recently published a report from the Economic Forecasting Center at Georgia State University that predicted we would see over 60,000 jobs in 2011 and over 78,000 in 2012. A report from the Atlanta Regional Commission forecasts 3 million new residents in the next 30 years. Our conclusion is that we are seeing the bottom of homes values for Metro Atlanta but do not expect a robust recovery. We expect to see annual home values slowly increase over time with a few bumps along the way. In approximately 2013, we expect to see a seller’s market return with higher than normal appreciation for a few years. Contact us to learn more about future predictions and how that impacts your decisions.

If you look at the average annual Case-Shiller index for each year, here is how homes purchased in recent years would compare to the current index:

Homes Bought in 2000 – Loss of 4.72%

Homes Bought in 2001 – Loss of 9.77%

Homes Bought in 2002 – Loss of 13.12%

Homes Bought in 2003 – Loss of 15.86%

Homes Bought in 2004 – Loss of 18.72%

Homes Bought in 2005 – Loss of 22.62%

Homes Bought in 2006 – Loss of 26.15%

Homes Bought in 2007 – Loss of 26.63%

Homes Bought in 2008 – Loss of 19.80%

Homes Bought in 2009 - Loss of 9.26%

Yes, we are slowly climbing our way out of this unprecedented housing crisis – but we are not there yet. So where will home values go from here? The key factors that will impact our home values include the following:

Demand From Buyers (We expect demand to slightly improve for 2011 with over 60,000 homes purchased.)

Mortgage Rates/ Credit Availability (Average mortgage rates in the past 50 years were 8%. We expect to see historically low mortgage rates this summer but expect to see rates rising during the later part of 2011 and into 2012. In a few years, we expect to see rates 1-2% higher.)

Supply/ Inventory Levels (We expect inventory to remain at slightly low to normal levels with a heavier mix of short sales and foreclosures for the next two years.)

Competition from Short Sales/ Foreclosures (We expect to see significant numbers of short sales & foreclosures for the next two years. Analysts predict that short sales and foreclosures will be approximately 60% of the transactions in 2011. However, we do not expect a flood of foreclosures that drives the overall inventory too high. Banks are not likely to harm their own values.)

You and your agent should be carefully watching the trends for short sales and foreclosures. Yes, we will continue to see some ups and downs along the way, but home values will rise again. In a few years, short sales and foreclosures will return to normal levels. The new homes inventory will remain low. That means we will see an undersupply of homes for sale and values will begin to rise. In 5 or 10 years, many will look back and regret not buying their dream home when they had the chance! Check back for our next posts with the latest facts and insight that can make you money!

Tags: Atlanta homes, Atlanta homes values, atlanta mortgage rates, Atlanta new homes, Atlanta real estate, atlanta real estate agents, atlanta real estate market report, Case-Shiller Index Atlanta, Prudential Georgia Realty
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Case Shiller Index Reported April 2011

Tuesday, April 26th, 2011

The latest Case-Shiller Index was published on Tuesday, April 26, 2011. As always, the index reports on data 60 days in arrears. Therefore, the index reports Metro Atlanta home values for February 2011. So what does the latest index show and what does that mean for home values in metro Atlanta?

Before we provide the answer, we want to make two caveats. First, the Case-Shiller index of home values is very different from average sale prices or median homes prices which only reflect what was actually sold in the market. If lower priced homes are selling more, then the average sales price will show a lower value than what market value may be for higher priced properties. The median price is simply the home sales price in the middle of the properties selected. The Case-Shiller Index reports on repeat properties sold and other factors which are generally better indicators of home values. Second, this index reflects the average home values for all of Metro Atlanta. Remember, people do not buy houses in America or even in metro Atlanta. They buy a specific property on a street in a local community. Real estate is local and every market is different. Your local agent expert can help you understand the specific metrics in your local market. However, these metrics are a good general indication on what is happening in our market.

Now for the news…. The February index continues a 7 month streak of falling home values. The March 2010 index was the previous low before these past few months in Metro Atlanta. The current index reflects values similar to home values in the winter of 1999. But we are returning to a more normal seasonal pattern which tends to see home values rise in the spring and summer months with drops in the fall and winter. The February index is 99.47 which is 53% down from last month and 5.85% down from February of last year. The root cause for these results are the aggressive prices of short sales and foreclosures in our market. Click on the link below to open the Excel spreadsheet that shows the details of the latest index.

Case Shiller Index Atlanta – February 2011 Index – Reported April 2011

The peak of our market was July of 2007 according to the Case-Shiller index. Since July of 2007, our homes values have slipped 27.11%. We expect to see lower index numbers in March with increases in the spring and summer. If you average the Case Shiller Index for the past 12 months, we are down 23.30% from the peak. We expect the get to the 25% down range based upon the 2010 annual index over the next few months. We believe it is more effective to use the ”average of the past 12 months” or “trailing 12 months” as an indicator instead of reacting to a specific month. The big factor to watch will be the pace of short sales and foreclosures entering the market.

Remember, you will not know the bottom of the market until it is already passed. We believe that we are seeing the bottom of the market this winter and early spring. The AJC recently published a report from the Economic Forecasting Center at Georgia State University that predicted we would see over 60,000 jobs in 2011 and over 78,000 in 2012. A report from the Atlanta Regional Commission forecasts 3 million new residents in the next 30 years. Our conclusion is that we are seeing the bottom of homes values for Metro Atlanta but do not expect a robust recovery. We expect to see annual home values slowly increase over time with a few bumps along the way. In approximately 2013, we expect to see a seller’s market return and higher than normal appreciation for a few years. Contact us to learn more about future predictions and how that impacts your decisions.

If you look at the average annual Case-Shiller index for each year, here is how homes purchased in recent years would compare to the current index:

Homes Bought in 2000 – Loss of 3.64%

Homes Bought in 2001 – Loss of 8.75%

Homes Bought in 2002 – Loss of 12.14%

Homes Bought in 2003 – Loss of 14.91%

Homes Bought in 2004 – Loss of 17.80%

Homes Bought in 2005 – Loss of 21.75%

Homes Bought in 2006 – Loss of 25.32%

Homes Bought in 2007 – Loss of 25.80%

Homes Bought in 2008 – Loss of 18.90%

Homes Bought in 2009 - Loss of 8.24%

Demand From Buyers (We expect demand to improve for 2011.)

Mortgage Rates/ Credit Availability (Average mortgage rates in the past 50 years were 8%. We expect to see historically low mortgage rates but expect to see rates rising during 2011. In a few years, we expect to see rates 1-2% higher. We also expect to see adjustable rate mortgages and other more exotic loan options disappear in 2011.)

Supply/ Inventory Levels (We expect inventory to remain at slightly low to normal levels with a heavier mix of short sales and foreclosures for the next two years.)

Competition from Short Sales/ Foreclosures (We expect to see significant numbers of short sales & foreclosures for the next two years. Analysts predict that short sales and foreclosures will be approximately 60% of the transactions in 2011. However, we do not expect a flood of foreclosures that drives the overall inventory too high. Banks are not likley to harm their own values.)

Tags: Atlanta foreclosures, Atlanta homes, Atlanta homes values, Atlanta new homes, Atlanta real estate, Case-Shiller Index Atlanta, Prudential Georgia Realty
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Americans Confident In Recovery Of Real Estate Market

Tuesday, March 29th, 2011

New national survey echoes Metro Atlanta consumers’ belief in real estate as a good investment.

The majority of America’s potential homebuyers and sellers — 68 percent — believe that the real estate market and property values will recover in the next year or two, according to a new survey by Prudential Real Estate and Relocation Services, a Prudential Financial, Inc. [NYSE:PRU] company. This exceeds the 47 percent of Americans who expected house prices would rise in a similar survey conducted in April 2010, underscoring a more bullish outlook for the real estate market today. In addition, 86 percent of Americans believe real estate is a good investment despite the market volatility of the past few years. The Prudential Real Estate Outlook Survey of 1,253 Americans between the ages of 25-64 in the market for buying a home was conducted Jan. 20-27, 2011.

The national survey reveals that six in 10 respondents are more interested in buying real estate (58%) and are optimistic about buying given the momentum of the economic recovery (59%). It also shows that although the price of many Americans’ homes declined during the recession, 89 percent recognize they can also buy a new house at a lower price.

“This survey clearly demonstrates that Americans nationally and locally continue to be optimistic about the real estate market and believe that home prices will rise,” said Dan Forsman, President & CEO of Prudential Georgia Realty. “A key take away from the survey is although consumers recognize that it is a good time to buy, they are concerned about their ability to sell their homes. This is one of the reasons for a slowdown in Metro Atlanta’s recovery.”

For those on the fence about buying, uncertainty about selling an existing home (77 percent), concern about getting a fair price for the home (67 percent) and emotions (58 percent) are holding them back. For those who have sold homes in the past year, despite the down market 78 percent report that they were satisfied with the sale. Of these, 32 percent were very satisfied with the final price of their home and 46 percent were grateful they were able to sell given market conditions. A relatively small number, 22 percent, indicated that they were disappointed or resentful about the price they received for their home.

The survey highlighted Americans’ interest in trading up their homes. Of the 45 percent looking to trade up, 64 percent wanted more space or property, 49 percent a nicer house and 41 percent a better neighborhood. Only 21 percent surveyed said they were looking to scale down, and 34 percent said that they wanted a similar home.

The survey highlighted the importance of getting the right price in today’s market —74 percent of buyers believe that many homes could meet their needs and that price is a significant differentiator, while 26 percent stated that they were willing to pay top of market for a home that specifically suits their needs. In setting the right price, however, sellers were split—with 53 percent wanting to price right at or slightly below market to attract more bids and 47 percent wanting to price slightly higher than market and hoping to find a buyer willing to pay more.

The majority of respondents highlighted the importance of real estate agents in the process of buying or selling their home. Seventy-five percent of those surveyed said that an agent is very important or essential to this process, with only 24 percent saying agents are helpful but not imperative.

“Americans continue to see real estate agents as having a very important role in helping them price, buy and sell their homes; which is reflective of our market as well,” added [name]. “Although the data underscores the value real estate agents provide, it also shows that the industry needs to continue to work hard to meet clients’ unique needs.”

The Prudential Real Estate Outlook Survey was conducted online. The margin of error is +/- 3 percent.

Tags: Atlanta homes, Atlanta homes values, Atlanta new homes, Atlanta real estate, atlanta real estate agents, atlanta real estate market report
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Case Shiller Index Reported March 2011

Tuesday, March 29th, 2011

The latest Case-Shiller Index was published on Tuesday, February 29, 2011. As always, the index reports on data 60 days in arrears. Therefore, the index reports Metro Atlanta home values for January 2011. So what does the latest index show and what does that mean for home values in metro Atlanta?

Before we provide the answer, we want to make two caveats. First, the Case-Shiller index of home values is very different from average sale prices or median homes prices which only reflect what was actually sold in the market. If lower priced homes are selling more, then the average sales price will show a lower value than what market value may be for higher priced properties. The median price is simply the home sales price in the middle of the properties selected. The Case-Shiller Index reports on repeat properties sold and other factors which are generally better indicators of home values. Second, this index reflects the average home values for all of Metro Atlanta. Remember, people do not buy houses in America or even in metro Atlanta. They buy a specific property on a street in a local community. Real estate is local and every market is different. Your local agent expert can help you understand the specific metrics in your local market. However, these metrics are a good general indication on what is happening in our market.

Now for the news…. The January index set a new 10-year low. The March 2010 index was the previous low before these past few months in Metro Atlanta. The current index reflects values similar to home values in the winter of 1999. We are returning to a more normal seasonal pattern which tends to see home values rise in the spring and summer months with drops in the fall and winter. The November index is 99.59 which is .44% down from last month and 6.96% down from January of last year. The root cause for these results are the aggressive prices of short sales and foreclosures in our market. Click on the link below to open the Excel spreadsheet that shows the details of the latest index.

Case Shiller Index Atlanta – January 2011 Index – Reported March 2011

The peak of our market was July of 2007 according to the Case-Shiller index. Since July of 2007, our homes values have slipped 27.02%. We expect to see lower index numbers through February or March with increases in the spring and summer. If you average the Case Shiller Index for the past 12 months, we are down 22.95% from the peak. We expect the get to the 25% down range based upon the 2010 annual index over the next few months. We believe it is more effective to use the ”average of the past 12 months” or “trailing 12 months” as an indicator instead of reacting to a specific month. The big factor to watch will be the pace of short sales and foreclosures entering the market.

If you look at the average annual Case-Shiller index for each year, here is how homes purchased in recent years would compare to the current index:

Homes Bought in 2000 – Loss of 3.53%

Homes Bought in 2001 – Loss of 8.64%

Homes Bought in 2002 – Loss of 12.03%

Homes Bought in 2003 – Loss of 14.80%

Homes Bought in 2004 – Loss of 17.70%

Homes Bought in 2005 – Loss of 21.65%

Homes Bought in 2006 – Loss of 25.23%

Homes Bought in 2007 – Loss of 25.71%

Homes Bought in 2008 – Loss of 18.80%

Homes Bought in 2009 - Loss of 8.12%

Demand From Buyers (We expect demand to improve for 2011.)

Mortgage Rates/ Credit Availability (Average mortgage rates in the past 50 years were 8%. We expect to see historically low mortgage rates but expect to see rates rising during 2011. In a few years, we expect to see rates 1-2% higher. We also expect to see adjustable rate mortgages and other more exotic loan options disappear in 2011.)

Supply/ Inventory Levels (We expect inventory to remain at slightly low to normal levels with a heavier mix of short sales and foreclosures for the next two years.)

Competition from Short Sales/ Foreclosures (We expect to see significant numbers of short sales & foreclosures for the next two years. Analysts predict that short sales and foreclosures will be over 60% of the transactions in 2011. However, we do not expect a flood of foreclosures that drives the overall inventory too high. Banks are not likley to harm their own values.)

Tags: Atlanta foreclosures, Atlanta homes, Atlanta homes values, Atlanta new homes, Atlanta real estate, Atlanta short sales, Case-Shiller Index Atlanta, Prudential Georgia Realty
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Case-Shiller Index Reported February 2011

Tuesday, March 1st, 2011

The latest Case-Shiller Index was published on Tuesday, February 22, 2011. As always, the index reports on data 60 days in arrears. Therefore, the index reports Metro Atlanta home values for December 2010. So what does the latest index show and what does that mean for home values in metro Atlanta?

Before we provide the answer, we want to make two caveats. First, the Case-Shiller index of home values is very different from average sale prices which only reflect what was actually sold in the market. If lower priced homes are selling more, then the average sales price will show a lower value than what market value may be for higher priced properties. This index also reflects “the averages” for all of metro Atlanta. Remember, people do not buy houses in America or even in metro Atlanta. They buy a specific property on a street in a local community. Real estate is local and every market is different. Your local agent expert can help you understand the specific metrics in your local market. However, these metrics are a good general indication on what is happening in our market.

Now for the news…. The December index set a new 10-year low. The March 2010 index was the previous low before these past few months in Metro Atlanta. The current index reflects values similar to home values in the winter of 1999. We are returning to a more normal seasonal pattern which tends to see home values rise in the spring and summer months with drops in the fall and winter. The November index is 99.92 which is .9% down from last month and 8.01% down from December of last year. The root cause for these results are the aggressive prices of short sales and foreclosures in our market. Click on the link below to open the Excel spreadsheet that shows the details of the latest index.

Case Shiller Index Atlanta – December 2010 Index – Reported February 2011

The peak of our market was July of 2007 according to the Case-Shiller index. Since July of 2007, our homes values have slipped 26.78%. We expect to see lower index numbers through February or March with increases in the spring and summer. If you average the Case Shiller Index for 2010, we are down 22.5% from the peak. We expect the get to the 25% down range based upon the 2010 annual index over the next few months. We believe it is more effective to use the annual average indicator than reacting to a specific month. The big factor to watch will be the pace of short sales and foreclosures entering the market.

Remember, you will not know the bottom of the market until it is already passed. We believe that we are seeing the bottom of the market this winter. The AJC recently published a report from the Economic Forecasting Center at Georgia State University that predicted we would see over 60,000 jobs in 2011 and over 78,000 in 2012. A report from the Atlanta Regional Commission forecasts 3 million new residents in the next 30 years. Our conclusion is that we are seeing the bottom of homes values for Metro Atlanta but do not expect a robust recovery. We expect to see annual home values slowly increase over time with a few bumps along the way.

If you look at the average annual Case-Shiller index for each year, here is how homes purchased in recent years would compare to the current index:

Homes Bought in 2000 – Loss of 3.21%

Homes Bought in 2001 – Loss of 8.34%

Homes Bought in 2002 – Loss of 11.74%

Homes Bought in 2003 – Loss of 14.52%

Homes Bought in 2004 – Loss of 17.43%

Homes Bought in 2005 – Loss of 21.39%

Homes Bought in 2006 – Loss of 24.98%

Homes Bought in 2007 – Loss of 25.46%

Homes Bought in 2008 – Loss of 18.53%

Demand From Buyers (We expect demand to improve for 2011.)

Mortgage Rates/ Credit Availability (Average mortgage rates in the past 50 years were 8%. We expect to see historically low mortgage rates but expect to see rates rising during 2011. In a few years, we expect to see rates 1-2% higher. We also expect to see adjustable rate mortgages and other more exotic loan options disappear in 2011.)

Supply/ Inventory Levels (We expect inventory to remain at slightly low to normal levels with a heavier mix of short sales and foreclosures for the next two years.)

Competition from Short Sales/ Foreclosures (We expect to see significant numbers of short sales & foreclosures for the next two years. Analysts predict that short sales and foreclosures will be over 60% of the transactions in 2011. However, we do not expect a flood of foreclosures that drives the overall inventory too high. Banks are not likley to harm their own values.)

Tags: Atlanta foreclosures, Atlanta homes, Atlanta homes values, Atlanta real estate, Atlanta short sales, Case-Shiller Index Atlanta
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Homeownership More Affordable Than Renting in 72 Percent of Major U.S. Cities

Tuesday, January 25th, 2011

RISMEDIA — Trulia.com, a top site for home buyers, sellers and renters released its latest Rent vs. Buy Index which found that it is more affordable to buy than to rent a two-bedroom home in 72% of America’s 50 largest cities. Meanwhile, a nation of renters has emerged as more Americans rent by choice or due to unforeseen financial difficulties. In contrast to this nationwide trend, renting is only less expensive than buying in four of the cities included in this study—namely New York, Seattle, Kansas City and San Francisco. The remaining 10 cities are locations where buying may still be a financially sound long-term decision despite the relative affordability of renting.

For Atlanta, the index is a 1-13 ratio which puts Atlanta in the category of “much less expenisve to buy than rent” versus other markets. Click the link below to view the report.

Trulia Rent vs Buy Index

“Since the start of the ‘Great Recession,’ many former homeowners have flooded the rental market. Following the principles of supply and demand, renting has become relatively more expensive than buying in most markets,” said Pete Flint, CEO and co-founder of Trulia. “Though necessary for achieving true economic recovery, stricter bank lending practices have also further aggravated the struggling housing market in the short term. Even highly-qualified home buyers face intense scrutiny on their income, savings, existing debt and credit history before they can get a mortgage loan.”

Cities overwhelmed by foreclosure filings and unemployment, including many cities in Florida, Arizona, Nevada and central California, typically correspond to more affordable markets for prospective buyers; however, there are exceptions. Oakland and Los Angeles, which are experiencing similar rates of unemployment or foreclosure filings as Phoenix, Miami and Sacramento, are still more affordable to renters. Moreover, close proximity to economic centers with promising job growth projections has propped up both the demand for homes and costs of homeownership in Oakland and Los Angeles.

“Although owning a home is relatively more affordable in most cities, market conditions have caused an interesting demographic swap between traditional renters and buyers,” said Tara-Nicholle Nelson, Consumer Educator for Trulia. “For example, lifelong renters are seizing the opportunity to become homeowners while affordability is high. At the same time, a growing number of long-time homeowners are finding themselves tenants—some by choice and others by necessity.”

Tags: Atlanta homes, Atlanta homes values, atlanta real estate market report, Prudential Georgia Realty
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Case-Shiller Index for November 2010

Friday, December 17th, 2010

The latest Case-Shiller Index was published on Tuesday, November 30, 2010. As always, the index reports on data 60 days in arrears. Therefore, the index reports Metro Atlanta home values for September 2010. So what does the latest index show and what does that mean for home values in metro Atlanta?

Now for the news…. The August index showed another negative result – as expected. The March 2010 index established a new low for Metro Atlanta and showed the 7th drop in a row after 5 positive months in a row. There is a normal seasonal pattern which tends to see home values rise in the spring and summer months with a drop in the fall and winter. The September index is 107.82 which is 1.04% down from last month and still 3.94% up from the March low. Atlanta home values reflect levels similar to May of 2000 according to Case-Shiller. Click on the link below to open the Excel spreadsheet that shows the details of the latest index.

Case Shiller Index – Atlanta – September 2010 Index

The peak of our market was July of 2007 according to the Case-Shiller index. Since July of 2007, our homes values have slipped 20.99%. Since the tax credits expired last spring, we saw an expected drop in closings for July, August and September. The fall season is typically slower due to normal seasonality. Therefore, we expect to see the Case-Shiller index begin to show additional small declines in the winter months. The big factor to watch next year will be the pace of short sales and foreclosures entering the market.

We do not expect to go beyond the low point of March 2010. Remember, you will not know the bottom of the market until it is already passed. The AJC recently published a report from the Economic Forecasting Center at Georgia State University that estimated our net job growth in 2010 at only 5000 jobs. However, that same report predicted we would see over 60,000 jobs in 2011 and over 78,000 in 2012. Our conclusion is that we are passed the bottom of homes values for Metro Atlanta but do not expect a robust recovery. We expect to see annual home values slowly increase over time with a few bumps along the way.

If you look at the average annual Case-Shiller index for each year, here is how homes purchased in recent years would compare to the current index:

Homes Bought in 2000 – Gain of 4.44%

Homes Bought in 2001 – Loss of 1.09%

Homes Bought in 2002 – Loss of 4.76%

Homes Bought in 2003 – Loss of 7.76%

Homes Bought in 2004 – Loss of 10.90%

Homes Bought in 2005 – Loss of 15.18%

Homes Bought in 2006 – Loss of 19.05%

Homes Bought in 2007 – Loss of 19.57%

Homes Bought in 2008 – Loss of 12.09%

Demand From Buyers (We expect demand to continue to be slower than normal with gradual increases in 2011.)

Mortgage Rates/ Credit Availability (We expect to see incredibly low mortgage rates for an extended period with increases coming sometime in the second half of 2011. We also expect to see adjustable rate mortgages and other more exotic loan options disappear in 2011.)

Supply/ Inventory Levels (We expect inventory to remain at normal levels with a heavier mix of short sales and foreclosures for the next two years.)

Competition from Short Sales/ Foreclosures (We expect to see significant numbers of short sales & foreclosures for the next two years. Analysts predict that short sales and foreclosures will be over 60% of the transactions in 2011. However, we do not expect a flood of foreclosures that drives the overall inventory too high. Banks are not going to harm their own values.)

You and your agent should be carefully watching the trends for short sales and foreclosures. Yes, we will continue to see some ups and downs along the way, but home values will rise again. In a few years, short sales and foreclosures will return to normal levels. The new homes inventory will remain low. That means we will see an undersupply of homes for sale and values will begin to rise. In 5 or 10 years, many will look back and regret not buying their dream home when they had the chance! Check back for our next posts with the latest facts and insight that can make you money!

Tags: Atlanta foreclosures, Atlanta homes values, Atlanta new homes, Atlanta real estate, atlanta real estate market report, Atlanta short sales, Case-Shiller Index Atlanta, Prudential Georgia Realty
Posted in Case-Shiller Index | No Comments »

Case-Shiller Home Value Index for October 2010

Wednesday, November 17th, 2010

The latest Case-Shiller Index was published on Tuesday, October 28, 2010. As always, the index reports on data 60 days in arrears. Therefore, the index reports Metro Atlanta home values for August 2010. So what does the latest index show and what does that mean for home values in metro Atlanta?

Now for the news…. The August index showed a slightly negative result after positive gains for the 4th month in a row. The March 2010 established a new low for Metro Atlanta and showed the 7th drop in a row after 5 positive months in a row. There is a normal seasonal pattern which tends to see home values rise in the spring and summer months with a drop in the fall and winter. The August index is 109.09 which is .85% down from last month and still 5.17% up from the March low. Atlanta home values reflect levels similar to May of 2000 according to Case-Shiller. Click on the link below to open the Excel spreadsheet that shows the details of the latest index.

Case-Shiller Index for Atlanta (August 2010 Index)

The peak of our market was July of 2007 according to the Case-Shiller index. Since July of 2007, our homes values have slipped 20.06% – which is an improvement from previous lower months. Driven by the expiring tax credits, the spring selling season was very active in March and April which translated to increases in closings for May and June. Remember, Case-Shiller reflects closed sales and not pended sales. Since the tax credits expired, we have seen an expected drop in closings for July and August. The fall season is typically slower due to normal seasonality. Therefore, we expect to see the Case-Shiller index begin to show declines in the fall and winter months. The big factor to watch next year will be the pace of short sales and foreclosures entering the market.

If you look at the average annual Case-Shiller index for each year, here is how homes purchased in recent years would compare to the current index:

Homes Bought in 2000 – Gain of 5.67%

Homes Bought in 2001 – Gain of .07%

Homes Bought in 2002 – Loss of 3.64%

Homes Bought in 2003 – Loss of 6.68%

Homes Bought in 2004 – Loss of 9.85%

Homes Bought in 2005 – Loss of 14.18%

Homes Bought in 2006 – Loss of 18.09%

Homes Bought in 2007 – Loss of 18.62%

Homes Bought in 2008 – Loss of 11.05%

Demand From Buyers (We expect to see normal fall demand.)

Mortgage Rates/ Credit Availability (We expect to see incredibly low mortgage rates for an extended period with increases coming sometime in the second half of 2011. We also expect to see adjustable rate mortgages and other more exotic loan options disappear in 2011.)

Supply/ Inventory Levels (We expect inventory to remain at normal levels with a heavier mix of short sales and foreclosures for the next two years.)

Competition from Short Sales/ Foreclosures (We expect to see significant numbers of short sales & foreclosures for the next two years. However, we do not expect a flood of foreclosures that drives the overall inventory too high. Banks are not going to harm their own values.)

You and your agent should be carefully watching the trends for short sales and foreclosures. Look for some juicy headlines that show big year-to-year drops in the late fall. Remember, last year we had the state and federal tax credits expiring at the end of November. Therefore, we had an unusual spike in closings. The federal tax credits ended up getting extended but that was not formalized until December. We expect normal demand this fall which will be less than the previous year.

Yes, we will continue to see some ups and downs along the way, but home values are on the rise. In 5 or 10 years, many will look back and regret not buying their dream home when they had the chance! Check back for our next posts with the latest facts and insight that can make you money!

Tags: Atlanta foreclosures, Atlanta homes values, Atlanta real estate, atlanta real estate market report, Atlanta short sales, Case-Shiller Index Atlanta, Prudential Georgia Realty
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Case-Shiller Index for September 2010

Wednesday, September 29th, 2010

The latest Case-Shiller Index was published on Tuesday, September 28, 2010. As always, the index reports on data 60 days in arrears. Therefore, the index reports Metro Atlanta home values for July 2010. So what does the latest index show and what does that mean for home values in metro Atlanta?

Now for the news…. The July index shows positive gains for the 4th month in a row. The March 2010 established a new low for Metro Atlanta and showed the 7th drop in a row after 5 positive months in a row. The July index is 109.92 which is .17% up from last month and 5.97% up from the March low. Atlanta home values reflect levels similar to May of 2000 according to Case-Shiller. Click on the link below to open the Excel spreadsheet that shows the details of the latest index.

Case-Shiller Index for Atlanta July 2010

The peak of our market was July of 2007 according to the Case-Shiller index. Since July of 2007, our homes values have slipped 19.45% – which is an improvement from previous lower months. Driven by the expiring tax credits, the spring selling season was very active in March and April which translated to increases in closings for May and June. Remember, Case-Shiller reflects closed sales and not pended sales. Since the tax credits expired, we have seen an expected drop in closings for July and August. The fall season is typically slower due to normal seasonality. Therefore, we expect to see the Case-Shiller index begin to show declines in the fall and winter months. We may see some form of “October surprise” coming from Washington since the November elections are just around the corner. As we get closer we get to the holidays, many sellers will hold out for spring. That is why we believe the best time to buy is between now and November! There are fabulous properties available at prices below their replacement costs and mortgage rates are at 50 year lows.

We do not expect to go beyond the low point of March 2010. Remember, you will not know the bottom of the market until it is already passed. The AJC recently published a report from the Economic Forecasting Center at Georgia State University that estimated our net job growth in 2010 at only 5000 jobs. However, that same report predicted we would see over 60,000 jobs in 2011 and over 78,000 in 2012. Our conclusion is that we are passed the bottom of homes values for Metro Atlanta but do not expect a robust recovery. We expect to see home values slowly increase over time with a few bumps along the way.

If you look at the average annual Case-Shiller index for each year, here is how homes purchased in recent years would compare to the current index:

Homes Bought in 2000 – Gain of 6.48%

Homes Bought in 2001 – Gain of .83%

Homes Bought in 2002 – Loss of 2.91%

Homes Bought in 2003 – Loss of 5.97%

Homes Bought in 2004 – Loss of 9.17%

Homes Bought in 2005 – Loss of 13.52%

Homes Bought in 2006 – Loss of 17.47%

Homes Bought in 2007 – Loss of 18.00%

Homes Bought in 2008 – Loss of 10.38%

Demand From Buyers (We expect to see normal fall demand.)

Mortgage Rates/ Credit Availability (We expect to see incredibly low mortgage rates for an extended period with increases coming sometime in 2011.)

Supply/ Inventory Levels (We expect inventory to remain at normal levels with a heavier mix of short sales and foreclosures for the next two years.)

Competition from Short Sales/ Foreclosures (We expect to see significant numbers of short sales & foreclosures for the next two years. However, we do not expect a flood of foreclosures that drives the overall inventory too high. Banks are not going to harm their own values.)

You and your agent should be carefully watching the trends for short sales and foreclosures. Look for some juicy headlines that show big year-to-year drops in the fall. Remember, last year we had the state and federal tax credits expiring at the end of November. Therefore, we had an unusual spike in closings. The federal tax credits ended up getting extended but that was not formalized until December. We expect normal demand this fall which will be less than the previous year.

Tags: Atlanta foreclosures, Atlanta homes, Atlanta homes values, Atlanta new homes, Atlanta real estate, atlanta real estate market report, Case-Shiller Index Atlanta
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Case-Shiller Index For July 2010

Tuesday, July 27th, 2010

The July Case-Shiller Index was published on Tuesday, July 27th 2010. As always, the index reports on data 60 days in arrears. Therefore, the index reports Metro Atlanta home values for May 2010. So what does the latest index show and what does that mean for home values in metro Atlanta?

Before we provide the answer, we want to make two caveats. First, the Case-Shiller index of home values is very different from average sale prices which reflect the average prices of what is being sold in the market. This index reflects the averages for metro Atlanta. Remember, people do not buy houses in America or even in metro Atlanta. They buy a specific property on a street in a local community. Real estate is local and every market is different. Your local agent expert can help you understand the specific metrics in your local market. However, these metrics are a good general indication on what is happening in our market.

Now for the news…. The May index shows positive gains for the 2nd month in a row. This March established a new low for Metro Atlanta and showed the 7th drop in a row after 5 positive months in a row. The May index is 107.82 which is 2.02% up from last month and 2.62% up from the March low. Click on the link below to open the Excel spreadsheet that shows the details of the latest index.

Case-Shiller Index For Metro Atlanta – May 2010

The peak of our market was July of 2007 according to the Case-Shiller index. The bottom was March of 2010. Since July of 2007, our homes values have slipped 20.98% – which is an improvement from previous lower months. The spring selling season was very active in March and April showing year-to-year increases in pendings of 47% and 28% respectively. Inventory remains down from last year but is increasing from the previous months of March & April. Remember, Case-Shiller reflects closed sales and not pended sales. We expect to see the index continue to show slight gains over the summer motnhs and then begin to trail off in the fall and winter months. We do not expect to test the low point of March 2010. Remember, you will not know the bottom of the market until it is already passed. Our conclusion is that we are passed the bottom of homes values for Metro Atlanta but do not expect a robust recovery. We expect to see home values slowly increase over time with a few seasonal bumps along the way.

If you look at the average annual Case-Shiller index for each year, here is how homes purchased in recent years would compare to the current index:

Homes Bought in 2000 – Gain of 4.44%

Homes Bought in 2001 – Loss of 1.09%

Homes Bought in 2002 – Loss of 4.76%

Homes Bought in 2003 – Loss of 7.76%

Homes Bought in 2004 – Loss of 10.90%

Homes Bought in 2005 – Loss of 1518%

Homes Bought in 2006 – Loss of 19.05%

Homes Bought in 2007 – Loss of 19.57%

Homes Bought in 2008 – Loss of 12.09%

Demand From Buyers (We expect to see continued demand through spring and summer months.)

Mortgage Rates/ Credit Availability (We expect to see incredibly low mortgage rates for an extended period with increases coming in late 2010 and 2011.)

Supply/ Inventory Levels (We expect inventory levels to remain lower than normal.)

Competition from Short Sales/ Foreclosures (We expect to see significant numbers of short sales & foreclosures for the next two years. However, we do not expect a flood of foreclosures that drives the overall inventory too high.)

You and your agent should be carefully watching the trends for short sales and foreclosures. Right now, home affordability is exceptional. We still have the combination of low home prices and the lowest mortgage rates in 50 years. Many wonderful properties are available below their replacement costs. But this scenario will not last forever. Rates will go up over time. Home values will be increasing – slowly but surely. Yes, we will continue to see some ups and downs along the way, but home values are on the rise. In 5 or 10 years, many will look back and regret not buying their dream home when they had the chance!

Check back for our next posts with the latest facts and insight that can make you money!

Tags: Atlanta foreclosures, Atlanta homes values, Atlanta new homes, atlanta real estate agents, atlanta real estate market report, Atlanta short sales, Case-Shiller Index Atlanta, Prudential Georgia Realty
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