While most of Atlanta metro's real estate markets continued on a downward spiral during 2009 due to high unemployment and anincreasing number of residential foreclosures, there is evidence to suggest that this trend, albeit at a lesser rate, will continue through 1Q 2010.
The statewide unemployment rate rose to 10.2 percent in November 2009, a 3.2 percent increase from the 7 percent noted in November 2008. It's been said that Georgia has lost a total of 370,000 jobs during the current recession, which represents aabout 9 percent of the state's total employment. Georgia's unemployment rate is expected to exceed 11 percent by 2Q 2010. On the bright side, 7 percent of Atlanta's employers expect to hire more employees. By the same token, 79 percent of companies surveyed have stated they do not plan to add any additional personnel to their workforce, and 12 percent have made plans to reduce staff levels in 1Q 2010. As long as a sizable percentage of our population continues to search for stable employment, it will continue to effect their ability to purchase needed goods, services, permanent shelter and prolong Georgia's economic recovery.
According to data base Realty Trac, Atlanta metro had the 39th highest foreclosure rate among American cities during 3Q 2009 with 24,787 foreclosures logged during this period, which is up 13.9 percent over 3Q 2008 and up 4.9 percent from 2Q 2009. During 3Q 2009, roughly one in every 85 homes was experiencing some form of foreclosure, While the Atlanta metro area, which is comprised of 16 separate counties, did experience an increase in home sales due to the 2009 $8,000 homebuyer tax credit (which was extended through April 2010 by the Congress), this only affected the bottom price ranges and did little to stimulate higher priced home sales. Overall, Atlanta average home prices are forecasted to decline another 7.8 percent during 2010.
In short, the 1Q 2010 Atlanta real estate market will continue to favor the purchaser and disfavor the seller due to an overabundance of real estate opportunities and attractive mortgage rates. On the flipside, sellers will continue to be VERY competitive and aggressive with getting their homes 'market ready' and paying close attention to pricing in order to avoid extended days on market and property stigma. In 2010, real estate professionals should continue to think outside the box as we strive to make money in this market. This means reevaluating what we do, why we do it and identifying our fiduciary relationships. We must acknowledge, once and for all, that the plagues that confront us (foreclosures/ high unemployment) will be with us for a while, but with every down market comes golden opportunities awaiting those with a willingness to take advantage of them. To paraphrase German philosopher Frederick Nietzsche: that which does not kill us only makes us stronger.
Sebastian Holmes, CRP, Broker/Owner, HOLMCO Property Solutions, LLC