After the dismal housing recession in Atlanta (and everywhere) that hit in 2008 and sent housing prices on a sharp decline, prices finally started to stabilize in late 2014 and have risen ever since. Having just emerged from the doldrums to a rapid rise in pricing, some experts are declaring a new “housing bubble”; but reports of the imminent death of the rising residential market are greatly exaggerated.
In Atlanta, we took longer to sink during the recession and have been slower to rise in the recovery. Right now we have a shortage of inventory but our prices still are not rising as quickly as they are in many cities. This measured response to the national trends bodes well for us; as does the fact that so many companies are bringing headquarters and employees to Atlanta. We have more buyers moving here, which will naturally put upward pressure on pricing, but which will serve to continue to support that pricing in the coming years as they continue to live and work in Atlanta.
In addition, as more sellers receive the news that housing prices are rising and that they ARE able to sell and make a profit, more are putting their homes on the market. This additional inventory is helping to reduce the number of competitive bid situations and to stabilize the rapid rise in pricing.
Further, it was a very loose mortgage lending environment that contributed to the original housing bubble. It was far too easy to get a mortgage at that time. That loose mortgage environment ground to a screeching halt in 2009 and it is still difficult today to secure a mortgage. The strict underwriting guidelines that were implemented following the “mortgage meltdown” are still in place, meaning that the torrent of unqualified buyers that precipitated the initial crisis are nowhere to be found and are, hopefully, never to return. Banks are lending only to qualified buyers with good credit scores who are less likely to default on their mortgage loans. Interest rates are still low right now, but are likely to rise, which will create yet another governor on the ability of buyers to purchase and the ability of sellers to ask ever increasing prices.
After fifteen years in the business, I have seen a lot of ups and downs in the housing market. This particular recovery, while fast, has not spun out of control and is unlikely to do so. While it’s always prudent for a buyer to carefully review the sales of comparable properties and to research the neighborhood and factors contributing to that neighborhood’s potential before agreeing on price, and although that price is going to be higher than it was three to five years ago, there’s no need to panic or to cork the bubbly over a housing “bubble”. Rather, we should continue to celebrate the housing recovery.
Mary Anne Walser is a licensed attorney and full-time REALTOR, serving buyers and sellers in all areas of Metro Atlanta. Her knowledge of residential real estate and her legal expertise allow her to offer great value to her clients. Mary Anne serves on the Committee that drafts and reviews the contracts utilized by all REALTORS in the State of Georgia. In addition, she is a member of the Atlanta Board of Realtors, the Georgia Association of Realtors, the State Bar of Georgia and the Georgia Association of Women Lawyers. Contact Mary Anne at 404-277-3527, or via email: firstname.lastname@example.org.