I hear the questions nearly every day.
When Is The Market Going To Get Better?
When Will The Housing Market Turn Around?
If I had a crystal ball, I'd be rich.
I'm also someone who typically sees the glass as half full rather than half empty.
Really it comes down to simple economics and yes, history does repeat itself. When I bought my first house in Massachusetts in the mid - 1980's Jimmy Carter was in the White House. Interest rates, and I'm not kidding here, were 21 percent. People still bought houses when interest rates were high, but as a result we bought relatively cheaper and smaller houses.
The good news is that Georgia has never experienced the housing inflationary values that have always affected New England, New York, California and other areas of the country. As bad as the market may seem, the Atlanta metro area is still a very affordable housing market. You can buy and afford far more house in Georgia than in any of the above mentioned areas. If I had a crystal ball, I suspect (and hope) the ball would continue to indicate that Georgia will continue to offer more affordable housing far into the future.
If you're a potential home buyer now, the Atlanta metro area is still very much a Buyers Market. If you have good credit, you will be very pleased with what you can accomplish as a home buyer. Home prices have come down significantly during the last few years and interest rates are still hovering at record lows. As a result, you can buy more house now, then you will be able to afford in the future. I'm pretty sure the crystal ball will concur.
If you're thinking about buying a home -- this is the time to take action. When interest rates begin to rise -- and sooner or later they will -- they have to based on government spending and economic conditions. For example, if today and at today's interest rate you qualify to afford a $300,000 home, when interest rates begin to rise your buying power will decrease relatively. So as rates begin to rise, you may see your buying power decrease relatively to a $250,000 investment and eventually a $200,000.
I have no idea what interest rates will eventually rise to. I truly hope I am wrong, but I personally think that if history repeats itself and based on current conditions, 21 percent will eventually look like chump change. People will still buy and sell property as they always have regardless of market conditions. We are a society that adapts.
If you are a home seller, and especially if your home has been on the market for several months, it may seem as though there is no end in site. However, you must realize, that the market in Georgia as well as all over the country, is going through a market correction. Values have slipped. Buyers have choices. You may know someone whose home did not appraise for the agreed upon sales price. This is happening with great regularity. As a result the sellers were faced with lowering the price of the house to agree with the appraised value or sit with the appraisal for 6 months to a year.
The good news is that when you finally sell your home (even if at a loss) you will make up for that loss when you purchase your next property. The challenge is to price your home aggressively and appropriately from the moment it goes on the market. Houses that are priced appropriately are selling in the Atlanta metro area. And, if interest rates do go up, Seller's may start to experience a sense of urgency among buyers.
If I only had a crystal ball......
Happy New Year to you and those whom you Love!
Sara Hibbard is a licensed Realtor in the state of Georgia. Sara specializes in working with families relocating to the Atlanta metro area and holds national designations in the areas of foreclosure, short sale, HUD and REO properties. Sara can be easily reached at 770-399-8108 or sara@SaraHibbard.com. Sara Hibbard is Glad Georgia Real Estate is on Your Mind!
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