Pockets of Atlanta Real Estate Industry Remains Stagnant for February 2015

The shortest month of the year saw a mix of positive and negative factors in the Atlanta residential real estate market; however, being focused on pockets of the consumer segment can return a 60% growth year over year as experienced at Southeast Mortgage in February. 

The Cal-Culator, Atlanta’s leading residential real estate index, will hold steady at 6.3 for another month due to a continued decline in mortgage delinquency rates and a long awaited increase in inventory offset by declining home sales and investment in the Atlanta market.

The February Cal-Culator

Let’s Start With the Bad
Investors’ Dollars in Atlanta & Home Sales: The Atlanta Business Chronicle reported that home sales in metro Atlanta fell 37 percent from December 2014 to January 2015 and were also down 9.7 percent year over year. The decline was attributed to investors buying fewer homes in the area.
Substantial Decline in First-time Homebuyers: The National Association of Realtors also released data that nationwide, existing-home sales fell 4.9 percent ­to the lowest rate in nine months. First-time homebuyers, a vital demographic in the housing industry, declined to 28 percent, the lowest rate since June 2014. According to NAR Chief Economist Lawrence Yun, “January housing data can be volatile because of seasonal influences.”

Now for the Good News
Inventory: According to the latest data from the Atlanta Board of Realtors’ latest Market Brief, Atlanta housing inventory increased 13.6 percent year-over-year and by a staggering 54 percent from the previous month. Last year’s local real estate industry was tainted by the Atlanta housing crunch, which seems to be easing thus far in 2015.

Mortgages: For the 12th straight quarter, mortgage delinquency rates (defined as the rate of borrowers who are 60 days or more late on their mortgages) declined, according to TransUnion’s latest mortgage report. The vice president of research and consulting at TransUnion noted that the mortgage delinquency rate “continues to be well controlled as it slowly recedes to pre-recession levels.”

It’s no surprise that the short month combined with multiple threats of snow around Georgia didn’t propel the real estate market as far as hoped. However, housing experts are still extremely optimistic about the remainder of 2015 and are not overly concerned with this brief bout of sluggishness.
“Low interest rates, rising sale prices, economic expansion and balanced inventory support my expectation that the market will continue its strong and steady growth,” said Atlanta Board of Realtors President Ennis Antoine. “I believe the dynamic economic recovery we are seeing is going to have a major impact on the 2015 Atlanta housing market.”

The next Cal-Culator will be released March 7. Stay tuned to see if next month will reflect a positive come back after a month of stagnation.

www.southeastmortgage.com
770-279-0222

June 2014 - Cal-Culator - Real Estate Index Hits Record High

Atlanta Residential Real Estate Index Hits Record High With Across the Board Housing Improvements

Amid the summer heat, real estate in Atlanta is sizzling. Last month, the Cal-Culator, Atlanta’s residential real estate index, reached the previous record of 6.0. This month, the June index has climbed to a record high of 6.2 due to across the board improvements in home sales, builder confidence, home prices, increased inventory, foreclosures and more.

The June Cal-Culator

Home Sales
Pending, new and existing home sales all   saw  strong improvements in May. Existing-home sales rose 4.9 percent, with attributions to rising inventory levels, the improving job market and declining mortgage rates. Pending home sales rose “sharply” 6.1 percent, the largest increase since April 2010 when first-time homebuyers scrambled to sign contracts before a lucrative popular tax credit ended, according to the National Association of Realtors.

New-home sales posted an even stronger rebound with a nearly 19 percent increase from last month, the highest rate since May 2008, according to data released by the U.S. Department of Housing and Urban Development with the U.S. Census Bureau.  “These numbers are in line with our recent builder surveys, which indicate that more consumers are getting off the fence and coming back into the marketplace,” said Kevin Kelly, chairman of the National Association of Home Builders.

Home prices
RealtyTrac reported that the median sales price of distressed and non-distressed U.S. residential properties rose 6 percent in May from the previous month and 13 percent from a year ago, the second consecutive month in a row with a double-digit annual increase and the biggest annual increase since prices bottomed out in March 2012.

Builder Confidence
New data from the NAHB and Wells Fargo Housing Market Index showed that builder confidence for new single-family homes rose to only one point shy of the threshold of what’s considered good building conditions. The index rose four points to a level of 49. Any number over 50 indicates the majority of homebuilders view conditions as “good” rather than “poor.”  “After several months of little fluctuation, a four-point uptick in builder sentiment is a welcome sign and shows some renewed confidence in the industry,” said Kelly.

Foreclosures
Foreclosure levels in Atlanta have continued the downward trend that has permeated the real estate industry in 2014. Foreclosures in June dropped to levels not seen since 2002. The Atlanta Journal-Constitution reported on data from Kennesaw’s Equity Depot that 2,054 foreclosures were reported in June across 13 Atlanta counties, compared to 11,016 during the height of the housing crisis.  The Northeast and West aren’t faring as well, however, as foreclosure levels skyrocketed in May, according to Housing Wire. 

Stay tuned as we release the next Cal-Culator on August 5 to see if Atlanta’s residential real estate numbers continue on their current path of rebound.

www.southeastmortgage.com
770-279-0222