Not too bad a time to be a buyer in Georgia.

Opinion article... by BRIAN PATTON

http://www.gwinnettherald.com/Articles-i-2007-12-14-168722.112113-Georgia_housing_may_be_undeserving_of_gloom.html

 

"The most recent housing report with one of the largest samplings of housing units was completed by the Office of Federal Housing Enterprise Oversight (OFHEO). This report, known as the Federal House Price Index Report, indicates that Georgia posted a surprising 3.54 percent appreciation in housing prices in the last year."

...

Despite the negative indicators of some real estate markets, it appears that Georgia is holding its own with not only the surprising past year appreciation of 3.54 percent, but a cumulative appreciation of 25.55 percent over the last 5 years. Even on a smaller scale, the Atlanta region has seen an increase of 2.61 percent over the last year and a 20.18 percent appreciation over the last 5 years.

...

The only negative note for Georgia homeowners is third quarter results for 2007. Georgia real estate barely makes it into negative appreciation for the third quarter of 2007, the equivalent of a mere $25 in value on a $250,000 home, hardly a cause for major concern.

 

Read the OFHEO report here http://www.ofheo.gov/media/pdf/3q07hpi.pdf

  • December 22 2007 - US
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Answers (34)

Profile picture for LongIslandBubble

The only negative note for Georgia homeowners is third quarter results for 2007. Georgia real estate barely makes it into negative appreciation for the third quarter of 2007, the equivalent of a mere $25 in value on a $250,000 home, hardly a cause for major concern.

 

OFHEO only records contracts that were signed; they don't account for when they fall through.

 

The reason there were so many signed contracts is because there were so many buyers from the north east that were buying there until sellers in the north east started having trouble selling their houses (lack of sheeple); when they can't sell their houses, they can't buy down south. 2008 is going to be really bloody for GA because of the oversupply due to excessive building.

 

..........but it won't be a bad time to rent in GA.

  • December 22 2007
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Jay: I sold my house for $5K less than I bought it......in May of 2007 it was appraised for $425.......sold it for $345........GA is doing just fine, just depends on exactly where in GA, suburbs of Atlanta are hurting and foreclosure are epidemic in some areas because of all the first time buyers who got into the game.  Sure, good time to buy, but since the ship is still sinking not so sure about that unless you are willing to loose a little in the first year of ownership, homes in the neighborhood I sold in have gone down another $10K since I sold one month ago......that is a pretty fast fall, eh.  

  • December 22 2007
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ofheo statistics also use refinance appraisals... thus in a slow market, it is a basically worthless statistic... better to use case-shiller

  • December 22 2007
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"OFHEO only records contracts that were signed; they don't account for when they fall through."

 

How is that relevant?

 

"The reason there were so many signed contracts is because there were so many buyers from the north east that were buying there until sellers in the north east started having trouble selling their houses"

 

Got any statistics on the numbers of northerners that were purchasing investment properties in ATL? I'd like to compare that number with some other stats.

 

.

 

 

  • December 22 2007
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"suburbs of Atlanta are hurting and foreclosure are epidemic in some areas because of all the first time buyers who got into the game"

 

True.

 

"I sold my house for $5K less than I bought it......in May of 2007 it was appraised for $425.......sold it for $345..."

 

If you don't mind me asking, why were you selling? What part of town where you in?

 

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  • December 22 2007
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A third of my neighborhood in ATL were northerners, then many more were from Florida fleeing after all the hurricanes they were fed up with.  There may not be concrete numbers Jay,  but when looking at the trend in the past few years it is not out of the realm for some cause /effect from slow sales up north.   

 

  • December 22 2007
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I know there are alot of northerners here, I'm not debating that but I'm not entirely convinced that they are all transplants.

 

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  • December 22 2007
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"ofheo statistics also use refinance appraisals... thus in a slow market, it is a basically worthless statistic."

 

Could you explain your rationale for how this negates the validity of the report?

 

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  • December 22 2007
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All of them had sold high up north, bought (what we thought) was low down there.   Most of the people that moved in this past summer were transplants.  Even though the airport is south of Atlanta, we had a lot of Delta employees whose home base was changed to Atlanta so they had to move there.   Not sure how a northerner isn't a transplant?  Or are you trying to decern between northerners who have been living down there verses one wanting to currently relocate down there? 

  • December 22 2007
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"Or are you trying to decern between northerners who have been living down there verses one wanting to currently relocate down there? "

 

Exactly... sorry I wasn't more clear about that.

 

I bring it up because its a rare thing to meet a born and raised Atlantan. I plenty of people are wanting to move intown to habitate the small forest of condos that have cropped up.  Possibly giving the illusion that there was a mass relocation from out of state.

 

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  • December 22 2007
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Otay.   

  • December 22 2007
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Profile picture for ZVending

We are northerners who were thinking about buying in GA, I spent a week in Dillard and loved it. The drought alone convinced half of the parties involved they want nothing to do with GA. Colorado here we come (someday! :p)

  • December 22 2007
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Profile picture for LongIslandBubble

"OFHEO only records contracts that were signed; they don't account for when they fall through."
How is that relevant?


Jay, exactly what I say, how is it relevant?; OFHEO uses signed contracts as sales. If they are falling through as many have walked away from their deposits, the numbers are obviously larger than they really should be. It's not a sale if the ownership never is transferred.

Got any statistics on the numbers of northerners that were purchasing investment properties in ATL? I'd like to compare that number with some other stats

I don't have any statistical data on it; around here it is common knowledge; they even did a 4 page spread in the Newsday about this some time ago. If you do some googling I'm sure you'll find plenty of data to support it, personally I have a few friends that moved there.

  • December 23 2007
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"Jay, exactly what I say, how is it relevant?; OFHEO uses signed contracts as sales. If they are falling through as many have walked away from their deposits, the numbers are obviously larger than they really should be. It's not a sale if the ownership never is transferred."

 

I re-read the method of compilation of the HPI and don't see any mention of sales contracts as a method of gathering data. 

 

"I don't have any statistical data on it; around here it is common knowledge;"

 

Unfortunately I can't parse common knowledge in a database.

 

.

 

  • December 23 2007
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Profile picture for LongIslandBubble

I re-read the method of compilation of the HPI and don't see any mention of sales contracts as a method of gathering data.

 

I read somewhere about this a long time ago; I was just doing some googling to find the source and I came accross this even bigger weakness which I totally forgot about. OFHEO bases their data only on mortgages bought by fanny and freddie.

 

As a result, the index will capture changes in the median price that are related not to changes in home values but to changes in the composition of the housing stock. The OFHEO Index resembles the Case–Shiller Indices in that it utilizes the repeat sales methodology; that is, it tracks the value of individual homes that are resold over time. Its weakness is that it is based solely on houses whose mortgages are purchased by Fannie Mae and Freddie Mac. This prevents the index from representing the entire housing stock of the community.

 

Source

  • December 23 2007
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Profile picture for LongIslandBubble

Unfortunately I can't parse common knowledge in a database


"I do think a lot of this movement — to Florida and the exurbs — reflects, in part, a 'housing affordability' movement, or what I have sometimes termed a 'middle class flight,' " William Frey, a demographer at the Brookings Institution in Washington, said in an e-mail message. "They'll move as far out as eastern Pennsylvania or northern Connecticut. But many are probably looking at Sun Belt markets, including central Florida, Georgia, North Carolina."

Source - New York Times

  • December 23 2007
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Its weakness is that it is based solely on houses whose mortgages are purchased by Fannie Mae and Freddie Mac. This prevents the index from representing the entire housing stock of the community.

 

But that wouldn't be a weakness considering the high volume of mortgages that the "Mac's service.  Using them creates a wide cross section from which data can be drawn.

 

 

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  • December 23 2007
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Profile picture for LongIslandBubble

But that wouldn't be a weakness considering the high volume of mortgages that the "Mac's service. Using them creates a wide cross section from which data can be drawn.

 

Read the rest of the article:

 

For example, the mortgage of the house that is being followed must be less than Fannie and Freddie’s conforming loan limit—$417,000 for a single-family home in 2006. To put this limit into perspective, note that the median home price in New York City is around $450,000. With 10 percent down, the median house would require a $405,000 mortgage. So the OFHEO Index for New York City could conceivably ignore almost half the housing units in the area.1 An even larger share of housing units would be left out of the calculations in San Francisco, where the median price is about $750,000.

  • December 23 2007
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Fine, by virtue of FM contstraints it leaves out some sections of the housing industry, but that doesn't negate the HPIs value as an indicator of the broader market.

 

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  • December 23 2007
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Jay Rock: “Read the OFHEO report here http://www.ofheo.gov/media/pdf/3q07hpi.pdf

 

 

I have never seen any report make so many excuses as to why they differ from the Case-Shiller index. 

 

 

Jay Rock:“I plenty of people are wanting to move intown to habitate the small forest of condos that have cropped up.”

 

 

Ooo lucky you, plenty of suckers lined up.

  • December 23 2007
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Profile picture for LongIslandBubble

Case/Shiller was created because of the shortcomings of the other indexes; it is the most accurate.

 

Even Case/Shiller isn't perfect because like all the others, they don't take into account all the incentives that are baked into the closing prices. So we know prices are even lower than what Case/Shiller reports.

  • December 23 2007
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All of you think that by coming onto zillow and spouting all this crap, you will have some kind of effect on the Real Estate industry.

 

You are totally deluded about how important you are. You have ZERO influence .

 

  • December 23 2007
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Profile picture for 2 Big 2 Fail

You also have ZERO influence infoseeking. 

  • December 23 2007
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Dangit Alpine, I really hate agreeing with you, but ok.  

 

None of has influence including the Fed!

  • December 23 2007
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Good. Now you can stop going on and on about how the market is 'fine' you lying sack of puss.

 

You should be more worried about trying to unload that shack you paid too much for.

  • December 23 2007
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Profile picture for Soldierette

Well, I for one am planning a move to Georgia whenever, God willing, our house sells. Housing is cheap there, especially in comparison to my hometown, ie, Washington, DC and suburbs.  I can buy a home from $50 to $100k and be totally content. A SFH, not a condo, and not inside Atlanta. I'm looking at Covington, Conyers, Jonesboro, Stone Mountain, places like that just outside the city. I will be paying cash and if I'm lucky, I will find a new job and start a new life in a new city.  I think the drout was probably a fluke... hopefully.

 

I've been looking at houses from the early part of this year in Georgia that are still sitting on the market. I feel sorry for these people because I've also seen a lot of them go from fsbo to foreclosure... really nice homes too. Some of these homes were built less than 7 years ago so somebody's dreams have gone up in smoke. I don't plan on low-balling some poor soul either. I'm in their boat right now and wouldn't want it to happen to me.

  • December 23 2007
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Profile picture for LongIslandBubble

All of you think that by coming onto zillow and spouting all this crap, you will have some kind of effect on the Real Estate industry.

You are totally deluded about how important you are. You have ZERO influence .

 

Many of us are still waiting for you to show us where I was "dishing it out".

  • December 23 2007
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Merry Christmas, infoseeking.

  • December 23 2007
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You make it seem like you are some kind of self important GURU by saying 'us'

 

The tried and true trick so suggest you have people behind you , idiot.

 

Nobody gives a rattz azz about YOU or YOUR reputation on Zillow you deluded clown.

 

People dont stay up all night wondering if LongIslandBubble boy's feelings have been hurt.

 

You arent important in the slightest. 

  • December 23 2007
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Merry Christmas, infoseeking.

 

Thankyou Mike. Merry Christmas to you too.

  • December 23 2007
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