A few thoughts on why this is the best time to buy a house in Marietta, GA.

To start, right now rates are at 4.375% on a 30 year fixed and 3.75% on a 15 year. And, rates are in the high 4’s on an investment property.  Clearly, we are near historic lows on borrowing money.

Lender Paid Mortgage Insurance Is Making a Comeback

As the market tries to recover, lender paid mortgage insurance is making a comeback. Mortgage insurance is required when the borrower puts down less than 20%.  However, instead of adding the PMI (private mortgage insurance) to the payment, lends basically increase the interest rate to cover PMI. This is very good for those who put 10% down or less because the borrower paid mortgage insurance (where you have the separate mortgage insurance payment) is very costly in the mortgage payment. Adjusting the interest rate results in a lower overall mortgage payment and is also tax deductible since it is part of your interest.

To give you an idea of the current rate on a lender paid mortgage insurance product, a 30 year fixed mortgage with a 10% down payment including lender paid mortgage insurance is 4.75% on a 30 year fixed today! You can even get lender paid mortgage insurance with as little as 5% down.

So, to summarize, YES, now is a great time to be buying at homes for sale in Marietta, GA or anywhere else in the Atlanta real estate market.

If you are thinking about taking advantage of this great buying opportunity, please contact me and I can provide you with additional information and access to some great mortgage lenders.

Thank you to Sean Trombetti with Amstar Mortgage for this information.

The median sales price for homes in Marietta, GA for September 2009 to November 2009 was $166,676. This represents a decline of 7.1%, or $12,824, compared to the prior quarter and a decrease of 2.8% compared to the prior year. The average listing price for Marietta homes for sale was about $314,000 as of December 23, 2009.

The housing market in Georgia has begun to recover. The national recession hit the area hard last year but not as bad as other areas and I believe it is on its way to recovery.

Housing Market Review

DECEMBER 2009

Homes Sold: 296

$ Volume: $63,585,700

Average Original List Price: $246,987

Avg. Last List Price: $227,955

Avg. Sold Price:  $214,817

ASP/ALLP: 94.6%

Avg. Total Days On Market: 125.0

Would like to know the market stats in your subdivision or a specific area?

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Housing Market Review

DECEMBER 2009

Homes Sold: 125

$ Volume: $38,672,010

Average Original List Price: $343,821

Avg. Last List Price: $328,070

Avg. Sold Price:  $309,376

ASP/ALLP: 94.5%

Avg. Total Days On Market: 94.6

Would like to know the market stats in your subdivision or a specific area?

Simply contact me and I can get that information to you.

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The FHA issues about 33 percent of all new mortgages and is the largest single source of lending for home purchases.  FHA Commissioner David Stevens says the tighter lending standards are significant, but not overwhelming for most borrowers.

Beginning summer of 2010, borrowers with a credit score lower than 580 will have to put down at least 10 percent to qualify.  Borrowers with higher credit scores will still qualify for the FHA’s 3.5 percent down payment program.  FHA home buyers will also be limited in how much money they can get from sellers toward closing costs, dropping from 6 percent to 3 percent of the purchase price; this will bring FHA into the same standards that Fannie Mae and Freddie Mac currently have.  And if Congress approves, borrowers will have to pay 0.5 percent more for insurance premiums.
This premium will rise from the current 1.75 percent of the loan amount to 2.25 percent. This change would apply both to the up-front and the annual premiums FHA charges.  Also, FHA does not make the mortgage loans itself.  Instead, FHA provides a government guarantee against the default for a mortgage issued by an FHA-approved lender. On an FHA loan, the mortgage insurance is split between an up-front charge paid at your closing and a yearly charge. The yearly charge is broken down each month for ease of payment by you as the borrower. This new mortgage insurance rate will go into effect in the spring.

Many lenders have already tightened their lending standards above what those that had been in place for FHA.  So many of these changes won’t be completely new for borrowers because they’ve been out in the marketplace for the last several months.

For more information on these changes or to see if you qualify for an FHA mortgage at 3.5%, please contact me.

Click here for more information.

What are your thoughts about these FHA changes?  Please post a comment below.

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The South had the lowest overall number of homes with price reductions at 20 percent.  The West, Midwest and Northeast each saw 22 percent of homes with price reductions.  The number of major cities with price reduction levels at 30 percent dropped from 14 in December to 7 in January.  Cities that saw the largest decrease in price reductions were Los Angeles at (46 percent decrease), New York (36 percent decrease), Memphis (34 percent decrease), Minneapolis  and Honolulu (both at 33 percent decrease).

Luxury homes (defined as those listed at $2 million  or higher) have been hit the hardest by price reductions with the average discount being 15 percent while the average discount for homes below $2 million held at 10 percent.

Read the full article here.  Read another version of this article here.

For Marietta homes for sale in December 2009, the average discount was 5.6 percent. For all houses in Cobb County for sale in December 2009, the average discount was 5.7 percent.

The agreement would extend the existing credit for first-time home buyers, worth up to $8,000, while offering a new credit of up to $6,500 for some existing homeowners. The reduced credit would be available to all home buyers who have been in their current residence for a consecutive five-year period in the past eight years.

The new provisions are aimed at broadening availability of the credit beyond first-time buyers and giving the weakened real-estate market a bigger boost while preventing real-estate investors from benefiting. Many property experts have cited the credit as a reason for signs of recovery in the housing market in recent months. But that recovery was somewhat undercut by the September drop in new-home sales reported Wednesday.

The credit would be extended from its current expiration date of Dec. 1 to all contracts entered into by April 30, and closed before July 1. It is expected that income limits on people claiming the credit would be increased to $125,000 for singles and $250,000 for couples, from the current $75,000 and $150,000, aides said. The credit phases out for people making more than those amounts.

While Senate lawmakers appear to have reached a deal on the substance of the tax credit, they are still at odds over how it would be brought to the Senate floor. Senate Majority Leader Harry Reid (D., Nev.) hopes to add it to a bill currently on the Senate floor to extend federal unemployment insurance benefits. But agreement on that hasn’t been finalized.

Bloomberg News adds:

At this time, it is believed that the credit will allow anyone purchasing (even if the property is not closed) a home by April 30, 2010 to participate and receive the full credit available. The credit will be continued (but reduced by 2% each 90 days) through the end of 2010! The credit will be slightly lessened, but it will be renewed and this extension should allow the market to continue to recover into and through next summer’s selling season. Of course, there’s always the possibility that it could be renewed at that time, as well.

The credit would be cut slightly to a $7,290 cap. Income eligibility for first-time home buyers would stay the same, but it would rise for step-up buyers to $125,000 for individuals and $250,000 for couples.

BusinessWeek.com added this qualifier but I have not seen it mentioned anywhere else:

* The credit could only be used for homes selling for $800,000 or less.

CNN.com states:

House Speaker Nancy Pelosi has indicated she also is interested in extending the homeowner credit, but House leaders have yet to endorse any one bill.

***********************************************************************

As you can see, in the 12 hours since this news has been released, there are several versions being reported.  I am sure we will get more details and facts in the next few days.  The good news is that is appears the tax credit will get extended and enhanced in some form.

It is unlikely that the Georgia state tax credit will be extended beyond November 30, 2009.

This is a compilation of information gathered from Bloomberg.com, CNN.com, BusinessWeek.com and WSJ.com.

The problem in providing an answer is that is really depends on the day you ask.  Over the last 12 months, there really has been any consistent trend in the market.  Some weeks see lots of activity and interest while others have no activity.  It has been this lack of consistency that has made this such a difficult market.

Positive News

Interest rates continue to be low (in the high 4%/low 5% range) and the $8000 federal tax credit for first time buyers and $1800 Georgia state tax credit for all buyers are good until the end of November.  In fact, houses are probably the most affordable they’ve ever been.  And, if you’re a home buyer, it’s still a buyer’s market.

On The Other Hand

National unemployment in about 10% and Georgia’s is slightly over 10%.  Job losses and uncertainty have undermined the confidence of home buyers.  In addition, while money is cheap, it is also still difficult to get a mortgage if your credit is not very good.

To get a clear picture of the overall Atlanta market, I have broken down the sales trends for 2006 through 2008. For 2009, I kept my original analysis period of January thru April  and have added May thru September.  This way you can see how the year is trending. The chart below shows the trends for all of the Atlanta using the FMLS data for single family homes.

EXPLANATION OF CHART

This chart shows the number of homes sold in 2006, 2007, 2008 and 2009 (thru September). 2007 and 2008 are also broken down into Jan-July an Aug-Dec time frames.  The last column represent the the number of currently active listings and their average asking price.  The actual data for each bar and line is shown at the bottom of the chart.

ANALYSIS

Units Sold – 2006 – 2008

2006 saw 46,437  homes sold with that number increasing to 58,115 in 2007.  We know that that market slowdown began in summer of 2007.  This is clear by looking at the breakdown of 2007 sales: 37,497 units from Jan-July and 20,618 units from Aug-Dec.  Total units sold in 2008 declined to 46,677 with the second half of the year seeing only 18,178 homes sold.

Units Sold – 2009

Thru April 30, 2009, 11,631 homes sold.  If we extrapolate this for the entire year, 2009 would see approximately 35,000 homes sold.  From May thru Sepetmber, 21,317 homes sold with an average sales price of $207,000.  This represents an 83% increase in home sales AND a 12.5% increase on average sales price.

There are currently 37,674 homes on the market which is approximately 15% less homes than at the end of April. This also represents 10.3 months of inventory at the current absorption rate. Clearly we are seeing a positive trend in sales. However, inventory is still above the 7-9 months which would represent a balanced market.  In addition, the current average list price of $361,000 for active listings is way too high and will need to come down in order to sustain this sales trend.

Average Sales Price

In 2006, the average sold price was $264,000.  This increased slightly to $265,000 in 2007.  The average sold price peaked in the first half of 2007 at $269,000. By 2008, the average sold price was down to $229,000.  For the first four months of 2009, the average sold price was $184,000. From May thru September, the average sales price increased by $23,000, approximately 12.5%, to $207,000.

Average List Price

The average list price in 2006 was $271,000.  The difference between the average list and average sold in 2006 was 2.7%.  By 2007, the gap between list and sold price increased to 3.4%.  In 2008, the gap had further increased to 6.1%.  For the first four months of 2009, the gap reached an amazing 20.0%. From May thru Deptember, the gap between asking and sold prices had narrowed to 9.1%.

Average Days on Market

This data is not shown on the chart but in the table below:

2006: 76

Jan – Jul 2007: 84
Aug-Dec 2007: 91
2007: 87

Jan-Jul 2008: 95
Aug-Dec 2008: 91
2008: 94

Jan – Apr 2009: 98
May – Sept 2009: 93

As we can see, the average days on market has decreased slightly increased from to 98 to a current 93 days.

Please feel free to contact me with questions about your specific market or community.  You can request a FREE home market analysis here.

RELATED POSTS:

Atlanta, Georgia Housing Market Review

The problem in providing an answer is that is really depends on the day you ask.  Over the last 12 months, there really hasn’t been any consistent trend in the market.  Some weeks see lots of activity and interest while others have no activity.  It has been this lack of consistency that has made this such a difficult market.

Positive News

Interest rates continue to be low (in the high 4%/low 5% range) and the $8000 federal tax credit for first time buyers and $1800 Georgia state tax credit for all buyers are good until the end of November.  In fact, houses are probably the most affordable they’ve ever been.  And, if you’re a home buyer, it’s still a buyer’s market.

On The Other Hand

National unemployment in about 10% and Georgia’s is slightly over 10%.  Job losses and uncertainty have undermined the confidence of home buyers.  In addition, while money is cheap, it is also still difficult to get a mortgage if your credit is not very good.

To get a clear picture of the Roswell/Alpharetta market, I have broken down the sales trends for 2006 through 2008. For 2009, I kept my original analysis period of January thru April  and have added May thru September.  This way you can see how the year is trending. The chart below shows the trends for Roswell and Alpharetta, Georgia (Fulton County only) combined.

EXPLANATION OF CHART

This chart shows the number of homes sold in 2006, 2007, 2008 and 2009 (thru September). 2007 and 2008 are also broken down into Jan-July an Aug-Dec time frames.  The last column represent the the number of currently active listings and their average asking price.  The actual data for each bar and line is shown at the bottom of the chart.

ANALYSIS

Units Sold – 2006 – 2008

2006 saw 2475 homes sold with that number increasing to 3028 in 2007.  We know that that market slowdown began in summer of 2007.  This is clear by looking at the breakdown of 2007 sales: 2034 units from Jan-July and 994 units from Aug-Dec.  Total units sold in 2008 declined to 2077 with the second half of the year seeing only 734 homes sold.

Units Sold – 2009

Thru April 30, 2009, 388 homes sold.  If we extrapolate this for the entire year, 2009 will see approximately 1200 homes sold.  From May thru September, 1266 homes sold with an average sales price of $410,000. While this period includes one more month than Jan thru April, the number of homes sold increased by over 225%!

There are currently 2004 homes on the market. Current inventory now stands at 10.9 months versus 20.2 months projected at the end of April. Clearly we are seeing a positive trend in sales. However, inventory is still above the 7-9 months which would represent a balanced market.  In addition, the current average list price of $618,000 for active listings is way too high and will need to come down in order to sustain this sales trend.

Average Sales Price

In 2006, the average sold price was $411,000.  This increased to $421,000 in 2007, an increase of  2.5%.  The average sold price peaked in the first half of 2007 at $427,000. By 2008, the average sold price was down to $417,000.  For the first four months of 2009, the average sold price had fallen to $376,000. From May thru September, the average sales price increase by $8,000 or approximately 2.1%.

Average List Price

The average list price in 2006 was $423,000.  The difference between the average list and average sold in 2006 was 2.9%.  By 2007, the gap between list and sold price increased to 5.1%.  In 2008, the gap had further increased to 5.5%.  For the first four months of 2009, the gap reached 7.5%. From May thru September, the price gap narrowed slightly to 6.8%.

Average Days on Market

This data is not shown on the chart but in the table below:

2006: 55

Jan – Jul 2007: 66
Aug-Dec 2007: 76
2007: 70

Jan-Jul 2008: 80
Aug-Dec 2008: 88
2008: 83

Jan – April 2009: 94
May – Sept 2009: 94

As we can see, the average days on market has remained at 94 days.

Please feel free to contact me with questions about your specific market or community.  You can request a FREE home market analysis here.

RELATED POSTS:

Roswell-Alpharetta, Georgia Housing Market Review

The problem in providing an answer is that is really depends on the day you ask.  Over the last 12 months, there really hasn’t been any consistent trend in the market.  Some weeks see lots of activity and interest while others have no activity.  It has been this lack of consistency that has made this such a difficult market. However, things are starting to change and trends are developing.

Positive News

Interest rates continue to be low (in the high 4%/low 5% range) and the $8000 federal tax credit for first time buyers and $1800 Georgia state tax credit for all buyers are good until the end of November.  In fact, houses are probably the most affordable they’ve ever been.  And, if you’re a home buyer, it’s still a buyer’s market.

On The Other Hand

National unemployment in about 10% and Georgia’s is slightly over 10%.  Job losses and uncertainty have undermined the confidence of home buyers.  In addition, while money is cheap, it is also still difficult to get a mortgage if your credit is not very good.

Market Analysis

To get a clear picture of the Cherokee market, I have broken down the sales trends for 2006 through 2008.  For 2009, I kept my original analysis period of January thru April  and have added May thru September.  This way you can see how the year is trending. The chart below for Cherokee County includes the cities of Woodstock,  Canton, Ball Ground, Holly Springs and Waleska.

EXPLANATION OF CHART

This chart shows the number of homes sold in 2006, 2007, 2008 and 2009 (thru September).  2007 and 2008 are also broken down into Jan-July an Aug-Dec time frames.  The last column represent the the number of currently active listings and their average asking price.  The actual data for each bar and line is shown at the bottom of the chart.

ANALYSIS

Units Sold – 2006 – 2008

2006 saw 2967 homes sold with that number increasing to 3550 in 2007.  We know that that market slowdown began in summer of 2007.  This is clear by looking at the breakdown of 2007 sales: 2312 units from Jan-July and 1238 units from Aug-Dec.  Total units sold in 2008 declined to 2389 with the second half of the year seeing only 869 homes sold.

Units Sold – 2009

Thru April 30, 2009, 595 homes sold.  If we extrapolate this for the entire year, 2009 will see approximately 1800 homes sold.  From May thru September, 1150 homes sold with an average sales price of $213,000. While this period includes one more month than Jan thru April, the number of homes sold increased by over 93%!

There are currently 2318 homes on the market, down from 2726 at the end of April.  Current inventory now stands at 12 months versus 18.3 at the end of April. Clearly we are seeing a positive trend in sales with some discounting on price continuing. However, inventory is still above the 7-9 months which would represent a balanced market.  In addition, the current average list price of $327,000 for active listings is way too high and will need to come down in order to sustain this sales trend.

Average Sales Price

In 2006, the average sold price was $250,000.  This increased slightly to $253,000 in 2007, an increase of just  1.2%.  The average sold price peaked in the first half of 2007 at $256,000. By 2008, the average sold price was down to $232,000.  For the first four months of 2009, the average sold price was $219,000.  From May thru September, the average sales price declined by $6,000 or approximately 2.75%.

Average List Price

The average list price in 2006 was $255,000.  The difference between the average list and average sold in 2006 was 2.0%.  By 2007, the gap between list and sold price increased to 3.2%.  In 2008, the gap had further increased to 5.2%.  For the first four months of 2009, the gap reached 6.8%.  From May thru September, the price gap narrowed to 5.1%.

Average Days on Market

This data is not shown on the chart but in the table below:

2006: 77

Jan – Jul 2007: 83
Aug-Dec 2007: 88
2007: 85

Jan-Jul 2008: 102
Aug-Dec 2008: 92
2008: 98

Jan – April 2009: 94
May – Sept 2009: 95

As we can see, the average days on market has increased from to 77 to a current 95 days which is less than 2008’s average of 98 days.

Please feel free to contact me with questions about your specific market or community.  You can request a FREE home market analysis here.

RELATED POSTS:

Cherokee County, Georgia Housing Market Review