Metro Atlanta Outlook

The economy and the real estate market for Metro Atlanta continues to show signs of improvement. Jeff Humphreys from the University of Georgia’s Terry School of Business predicts that the Georgia economy will perform on par with the national economy in 2013. That is a change from his reports on the previous 3 years where Georgia performed lowered than the national economy. He also predicts that home values will rise 3% in 2013 and that many potential buyers will get back into the market before prices and mortgage rates rise to higher levels. Roger Tetterow from the Stetson School of Business and Economics at Mercer University agrees. He predicts that Georgia will begin to outperform the national economy as we see more progress in housing & construction, financial institutions and government. Metro Atlanta is adding net positive jobs again and growing in population according to the Atlanta Regional Commission. According to the U.S. Census, the 28- county region was the ranked #3 in growth from 2000 to 2010. Corporations see the opportunity and are moving to Atlanta. Baxter, Porsche and many others are taking advantage of our great values for business and housing.

The Metro Atlanta real estate market is also showing signs of improvement. Closed transactions are up 11% over 2011. Inventory is getting extremely low with most market down over 30% from last year and 50% from the previous year. Pre-Foreclosures and Foreclosures have slowed. Bank-Owned sales are outpacing the incoming volumes of Foreclosures so the overall inventory of distressed properties is shrinking – making resales and new homes stand out. We expect that we will see the banks be more aggressive in Short Sales after the election and into 2013. Short Sales cost them less to process than Foreclosures.

We also see heavy action from investors in the $50k to $200k price points. In general, properties with a good value proposition are selling fast. New home builders are slowly moving back into the business. We expect to see a steady rise in construction over the next few years. As home values rise, more builders will be able to make the math work and banks will start lending again. The outlook for residential real estate is slow and steady improvement with a few bumps along the way. Pending reforms for the mortgage system, changing tax policies and tackling our massive debt problems could have a major impact.

If you would like to see that latest stats for one of our local markets, click here to view a 90-second video market update. Contact us for additional information.

Analysts Forecast 5% Rise in Home Prices

Bank of America Merrill Lynch analysts predict home prices will increase by 5% year-over-year in the fourth quarter, which is up from a previous prediction made in August that prices would rise 2%.

Bank of America Merrill Lynch revised its housing forecast upward due to a better alignment of supply and demand, and now predicts the S&P/Case-Shiller Index will increase by 5% in the fourth quarter over 4Q 2011.

That translates into an average price gain of 2.1% this year compared to 2011.

In August, BofA analysts predicted prices would rise 2% in the fourth quarter over the year-ago quarter. That was also a revision upward. In March, BofA Merrill Lynch forecasted the bottom in national home prices. However, it underestimated the magnitude of the turn.

The analysts also expect average home price appreciation of 3.3% a year over the next 10 years, a cumulative gain of about 36%.

BofA still expects home prices to slow down into the end of the year.

“It is important to remember that the housing market is subject to volatility in the best of times; in this distorted market, we cannot expect a smooth pattern,” the research note said.

It predicts that national prices will increase 5.6% quarter-over-quarter in the third quarter of 2012, following a 9.3% gain in the second quarter. It predicts flat prices in the fourth quarter of this year as well as a decline of 1.6% in the first quarter of 2013 before prices begin to trend upward.

The main component driving the forecasted increase in home prices is a better alignment of housing supply and demand. Inventory of homes for sale continues to decline because of pickup in house demand, a slow clearing rate for distressed properties and a significantly below normal pace of new home construction.

Sales of REOs were at the lowest pace in August since 2008, which reflects a shift toward short sales.

To view the decline in supply of exisiting and new homes for sale click on the chart.

Analysts said the two most important variables for short-term price dynamics are months supply and change in distressed share. They predict that the decline of months supply will continue to edge lower in 2013, which will underpin home prices. Share of distressed sales should return to 23.7% by 3Q, compared to the current share of 20.5%.

There are also many differences on a regional basis, which can be attributed to the way foreclosures are cleared in different states.

For example, year-over-year prices are up 7% in Michigan, compared to year-over-year falling prices in Illinois of 2.3%.

 

Selling your home this winter? A great deck spruces up the curb appeal

Some great advice from The Brownsville Herald in Brownsville, Texas– Curb appeal is integral when selling a home, but when the trees are bare and the ground is covered in dirty snow, the winter months can make it very difficult to showcase your home’s attractive landscaping. But smart sellers know that taking extra steps to care for and present a home’s exterior is a worthwhile investment, particularly during the real estate off-season. There is one improvement you can make that will help boost your home’s outdoor appeal no matter what the season: a deck.

When potential buyers visit your home in winter, they might not be able to envision how green and lovely your backyard will look come spring, but they will be able to see with their own eyes what a deck adds to the home’s living space. Decks, patios, sunrooms and porches have always been popular with homebuyers, but real estate agents say that too often these spaces are neglected or not used to their best advantage.

Yet outdoor improvements like a deck can significantly enhance your home’s value and appeal. In fact, at the time of resale, a deck will recoup about 73 percent of its original cost, according to “Cost vs. Value” in Remodeling Magazine.

“Anything that adds living space adds value, and the least expensive way to gain space is to build a deck or turn the one you have into an outdoor room by staging it so that it flows seamlessly with the rest of the house,” says Mary Beth Harrison of The Harrison Group, a Dallas-based real estate agency. “A great deck can set your home apart from others with the same interior floor plan or square footage, and deck additions typically add value when it comes time to sell.”

The cooler temperatures of fall and early winter make the season a great time to add a deck to your home. Or, if you already have a deck, enhance its appeal by adding simple touches and accessories that include:

* Staging a tiny deck or a rarely-used balcony off a master bedroom as a romantic getaway with cozy, cushioned seating and a raised fire pit.

* Adding designer style while safeguarding your deck with Latitudes Deck Stones, 16-inch interlocking square tiles made of natural slate or granite. Deck stones provide an effective fire barrier that’s an asset under fire pits or grills, or when used to create an outdoor kitchen.

* Lighting a deck to create a warm, welcoming mood for evening entertaining, as well as an important safety feature. LED deck lighting kits, like those offered by Deckorators, are both practical and visually appealing.

* Incorporating deck railings into your design to add both safety and visual appeal. Decorative railings with ornate balusters, post caps and post covers can give virtually any wood or composite lumber deck a distinctive look for a modest investment.

“More than ever before, people look at their decks as outdoor entertainment areas,” says Chris Fox of Universal Forest Products, producer of Latitudes Composite decking and railing and Deckorators, a leader in decking railing systems and deck accessories. “For some, it’s a kitchen; for others, a living room. Decks can be party spaces or quiet retreats. With so many different types of deck materials, lighting, rail systems and decorative accents, it’s possible to turn a plain deck into a fantastic outdoor living space.”

“Potential home buyers always react positively to nice decks that look like a great place to hang out,” says Harrison. “From a buyer’s perspective, if all else is equal, it’s true that the home with the best deck wins.”

Article URL: http://www.brownsvilleherald.com/online_features/real_estate/article_3c426a31-4be5-56e4-a685-1d4f5bf746ab.html

The Housing Market Scores Well in 2 Recent Reports

According to results from Fannie Mae’s November 2012 National Housing Survey, Americans are showing increased confidence in the housing market and the general direction of the economy, despite any  uncertainty surrounding the “fiscal cliff”.  You can read more about the survey results here but here are some of the highlights in housing results:

• Average home price change expectation held steady at 1.7 percent.
• Fourteen percent of those surveyed say that home prices will go down in the next 12 months, a 4 percentage point increase over last month.
• The percentage who think mortgage rates will go up continued to rise, increasing 4 percentage points in November to 41 percent.
• Twenty-three percent of respondents say it is a good time to sell, a 5 percentage point increase over last month, and the highest level since the survey’s inception.
• The average rental price expectation hit 4 percent in November, a 0.9 percent rise over the past two months.
• Forty-eight percent of those surveyed say home rental prices will go up in the next 12 months, a slight decrease from last month.
• The share of respondents who said they would buy if they were going to move held relatively steady at 67 percent.
• Fifty-one percent of respondents now say it would be easy to get a mortgage, marking the highest rate since the survey’s inception.

A report from the Obama administration supports this confidence. Home prices are continuing to rebound, and more home owners are taking advantage of refinancing to lower their monthly mortgage payments. The Obama Administration’s November Housing Scorecard reports the housing market’s made big strides and shows a marked improvement that has not been seen since before the housing crisis. “Six consecutive months of rising home prices have bolstered home owners’ equity,” said Erika Poethig, HUD acting assistant secretary for Policy Development and Research. Nationwide home owner equity is now $1.5 trillion higher than in April 2009.

Want to know more about your local housing market? Check out our video market reports updated monthly with the latest stats for over 50 metro Atlanta areas.

A Special Holiday Greeting from Petersen Partners

Greetings!

As the year draws to a close, we want to reach out and thank all of our friends and clients for your support. 2012 has been a busy and wonderful year for all of us at Petersen Partners.

Our team is really a big family and we’re like most families- each of us have our own personalities and we love to joke with each other. We also have a serious side, though. Each of us plays an important role in serving our clients and supporting one another. In 2012, we saw the local real estate market continue to improve. That kept us pretty busy and our hard work made us the #2 Prudential Realty of Georgia team in all of metro Atlanta. We are grateful for our successes and the family, friends, and clients who supported us. With our success came great opportunities and our family grew to include three new members this year.

Like most families, we like to cut up and have fun, but we also share some core values and commitments. We are more than just REALTORs, we’re a part of a larger community and our number one goal is making that community a better place to call home.

1st Annual Shred Event a success!

 

 

In April, we hosted our first annual Community Shred event. Together, we were able to shred and recycle enough paper to equal 20 trees!

 

 

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In August, we called on the community to help us gather school supplies for Nickajack  Elementary school. Together, we helped support a better educational experience for many young children!

 

 

 

Petersen Partners delivers Christmas gifts

 

 

 

 

In November, we collected Toys and Blankets to support MUST Ministries’ Christmas Shop, which gives 4500 local parents in need one of the greatest gift we could ever share- delighting their children with new toys and blankets on Christmas! With the help of local businesses and a generous community, we collected car load after car load of gifts. Just imagine the smiles you all helped create!

As we look forward to 2013, we thank you all and wish you all a wonderful new year! May it be filled with laughter and love.

We have great plans for 2013 and we hope you will be a part of them. Watch for updates on our Facebook page and be sure to check out our website for upcoming events.
decemberOur best wishes for a wonderful holiday season and the very best new year,

The Petersen Partners Family

Townhomes: A Growing Option Once More?

Townhouses are showing a strong comeback. For the third-consecutive quarter, the construction of townhomes — attached single-family housing — saw a sharp rise in total units and market share to a point that hasn’t been seen since 2008, the National Association of Home Builders reports.

The construction of townhouses nearly doubled in the past year — rising from 12,000 starts in the third quarter of 2011 to 21,000 starts during the third quarter of 2012. The market share of townhouses makes up 12.1 percent of all single-family housing starts, up from 11.2 percent during the previous quarter of this year.

The peak of townhouse construction was reached during the first quarter of 2008 at 14.6 percent.

The National Association of Home Builders predicts a rise in townhome construction in the coming years. “The prospects for the townhouses are positive given large numbers of home buyers looking for medium-density residential neighborhoods, such as urban villages that offer walkable environments and other amenities,” according to NAHB economists.

Source URL: http://realtormag.realtor.org/daily-news/2012/12/18/townhomes-growing-option-once-more?utm_source=feedburner&utm_medium=email&utm_campaign=Feed%3A+DailyRealEstateNews+%28Daily+Real+Estate+News%29

Cozy Fireplace Ideas

A fireplace and hearth are the focal point of any room. Even when it’s not in use, the fireplace is what anchors the room and sends an inviting message of warmth.

But not all fireplaces, hearths, and surrounds are so pretty to look at. In many homes, the fireplace goes from a defining architectural detail to a major element holding a home back style-wise. So many fireplaces are outdated, in disrepair, or just plain blah.

If your fireplace is guilty as charged, check out Better Homes and Gardens Magazine’s before and after fireplaces feature for some great inspiration. Faux stacked stone is a great, inexpensive DIY project and it’s easier than you may think! So before you try once again to temporarily disguise your fireplace behind Christmas stockings and garland again, find your fireplace design style and consider these tips for a mantel makeover.

 

Report: Foreclosure Discounts Narrowing in Metro Atlanta

The Atlanta Journal Constitution’s J. Scott Trubey recently reported that metro Atlanta foreclosure discounts are narrowing. The real estate website Zillow reported last week that foreclosed homes are no longer the great deals they once were in and around Atlanta. Bad news for investors or home buyers with limited budgets maybe, but definitely news that’s in keeping with reports of the metro area’s housing market improving.

Zillow reported that the median discount on foreclosures in September was only about 8 percent from market value both in the metro area. Nationwide, the percentage is similar. At the peak in 2008, the discount on foreclosures in metro Atlanta was 28 percent. That was a pretty steep discount compared to national discount of 24 percent at its peak in 2009.

Trubey reports, “Distressed borrowers and banks are now more often coming to terms on loan modifications and other alternatives to foreclosure, reducing the supply of distressed homes, said Jude Rasmus, president and CEO of Rasmus Real Estate Group, a top brokerage of foreclosures. Foreclosures are more often netting multiple bids, both from major investors and regular home buyers, she said.”

Although home prices in metro Atlanta are still below their 2000 levels, home values rose in 2012. A report released last month showed August was the fifth straight month of increased home prices in the metro area.

As Trubey explains Zillow’s calculations and comparisons, “Instead of comparing the median sales price of foreclosures to the median sales price of nonforeclosures, Zillow compared foreclosure prices to an estimated fair market resale price for the properties.” Based on strictly median sales price, the metro Atlanta foreclosure discount was 56.5 percent. Truby also reported, “Zillow said that such an analysis isn’t a fair comparison, as foreclosures often have different attributes than the average house and that lower priced homes are more likely to be in foreclosure.”

New Short-Sale Guidelines are Win-Win for Everyone

New short sale guidelines from Fannie Mae and Freddie Mac are designed to prevent deceptive transactions that pop up in times of distress when servicers and borrowers are negotiating short sales, representatives from Freddie Mac said in an exclusive webinar with HousingWire.com.

The new Federal Housing Finance Agency short sale guidelines took effect Nov. 1, prompting HousingWire to invite Ryan McGuinness, senior servicing policy analyst at Freddie Mac, and Simone Beaty, operations policy director at the GSE, to go in-depth on what servicers and borrowers can expect when the new short sale guidelines hit.

The guidelines were launched to streamline short sales while also giving servicers the power to expedite the process of identifying qualified borrowers, so they can smoothly transition into a short sale when needed.

McGuinness said the new FHFA process also will educate homeowners about their options for short sales. For example, if a borrower acts in good faith on a short sale, Freddie will not pursue deficiency, and may provide up to $3,000 in relocation assistance.

Freddie is confident the new guidelines will help root out fraud.

Since the threat of short-sale property flipping can undermine the GSEs’ approach to helping distressed borrowers, all short-sales transactions are required to be arms-length deals, McGuinness and Beaty pointed out during the webinar.

Short-sales flipping occurs when a party buys a short-sale and sells it for a profit the same day, McGuinness explained. The arm’s length transaction requirement is in the guidelines to prevent this type of practice. Arm’s length transactions are defined as deals between parties who are independent of each other and not related by either family, marriage or commercial enterprise, McGuinness and Beaty said.

The webinar also broke down the new powers delegated to servicers in the short-sale process. A replay will be available on this page by Friday, October 26.

Servicers will have the authority to approve a standard short sale for borrowers who are 31 days or more delinquent and borrowers who are less than 31 days delinquent as long as they are facing a hardship.

If a borrower is less than 31 days delinquent and facing a hardship like divorce, death, disability or military change of station orders, servicers now have the authority to approve a short sale in these circumstances, the webinar hosts said.

HousingWire routinely hosts webinars to give our readers a more in-depth look at the many changes impacting the mortgage servicing space.

Click here to read more about the new short-sale guidelines.

 

Article URL: http://www.housingwire.com/news/freddie-mac-new-short-sale-guidelines-attempt-prevent-deceptive-flipping

 

What’s Really Behind the Housing Recovery?

The housing market has shown several consecutive months of improvement in home prices and buyer demand. The Case-Schiller index of home prices, released recently, showed a sixth straight month of year-over-year increases. Real estate website Trulia compiles a “housing barometer” that measures how close the real estate market is back to normal based on housing starts, existing-home sales, and delinquency and foreclosure statistics. Trulia’s most recent housing barometer reading put the housing market at 47% back to normal.

A recent TIME magazine article questions what’s really behind the real estate market’s improvement.

Tim Iacano of Iacano Research gives much of the credit for the recovery and rise in home prices to the Federal Reserve. The Fed’s aggressive efforts to stimulate the economy. Their quantitative easing (QE) program, aimed at keeping mortgage rates low, has prompted mortgage rates to fall to all-time lows in recent months and weeks.

Lower interest rates stimulate the economy by increasing home values. When the interest rate a buyer needs to pay in order to finance the purchase of a home is lowered, the price at which a buyer can afford to purchase the home is raised.

For example, Iacano points out that a buyer today could purchase a house worth $280,000 and if he’s able to snag a record-breaking 3.3 percent mortgage rate, he’ll have a $1,100 per month mortgage payment.

“Even if mortgage rates moved back up to their 20-year average rate of 6.5 percent (what many thought were  simply unbelievable rates when they first dropped that low last decade), that same $1,100 mortgage payment would finance a home purchase of just $193,000, not the current $279,000,” Iacano points out. “The difference between these two prices is nearly 50 percent!”

Want to know what the local Atlanta, Cobb, or Smyrna market is doing? Check out our latest video market update.