The Atlanta Business Chronicle reports the following trend predictions for Residential Real Estate in Metro Atlanta:
Residential real estate trends for 2008
1) Housing inventory will begin to drop off in the second half.
2) The mortgage industry will be back to normal — and healthier than before — sometime around mid-year.
3) The pace of new home-building will continue to slow, especially for condos, and some proposed projects will be put on hold or cancelled.
In an article that quotes several Atlanta real estate veterans, here are two of my favorite quotes:
"I don’t believe 2006 was a sustainable real, free marketplace in that underwriting guidelines had been relaxed to the point that it created a false-buyer marketplace," said Kevin Levent of Metro Brokers GMAC.
"It cycles all the time … it will come back around," Giannoni says. "We got very spoiled because we were all so used to the boom that when the boom stopped everyone got into a panic; but the reality is that it got back to what everyone else was experiencing."
Both of these quotes illustrate my opinions about our current real estate market in Metro Atlanta. All markets have cycles and Atlanta is set to rebound quicker than most other markets because we never saw inflated appreciation rates. Atlanta has averaged 4% to 10% inflation while some markets saw 20% to 40% over the past 6 years. Atlanta’s problems are mostly in the new home industry where supply outpaced demand. There may be some price corrections, but most areas of Atlanta will see continued appreciation throughout this downturn.
