Statistics for single family detached homes in the North Fulton County real estate market for the month of January 2009 are in. North Fulton County is divided into two different areas and we will examine each area and then look at North Fulton County as a whole.

Area 13

Area 13 is the section of the county that is West of Ga. 400 and North of Chattahoochee River to the County lines and includes addresses from Alpharetta and Roswell. In the resale segment of the market there were 47 properties ranging in price from $139,900 to $1,350,000 that went under contract and 11 properties that closed ranging in price from $55,000 to $596,000. In the new construction segment of the market 2 properties went under contract ranging in price from $679,900 to $779,900 and 2 properties that closed ranging in price from $772,500 to $1,350,000.

Area 14

Area 14 is the section of the county that is East of Ga. 400 and North of Chattahoochee River to the County lines and includes addresses from Alpharetta, Duluth, Johns Creek and Roswell. In the resale segment of the market there were 47 properties ranging in price from $128,900 to $775,000 that went under contract and 7 properties that closed ranging in price from $158,900 to $420,000. In the new construction segment of the market 4 properties went under contract ranging in price from $307,172 to $799,900 and 2 properties closed ranging in price from $442,000 to $619,900.

North Fulton County Summary

For the month of January 2009, real estate sales for single family detached homes in North Fulton County looked like this:
•    94 Resale Properties Went Under Contract
•    18 Resale Properties Closed
•     6 New Construction Properties Went Under Contract
•     4  New Construction properties Closed

The resale segment of the North Fulton County Real Estate market is providing the catalyst for the recovery in this area. Compared to December of 2008 resale properties going under contract in North Fulton County increased by 80.76 percent. Hopefully this trend will continue and the entire Greater Atlanta Market will soon flourish and stimulate the economy in our great metropolitan area.

The Isakson/Lieberman Amendment

News out of our nation’s capital is providing perspective buyers with reason to celebrate and look ahead in the housing market. We have all heard of the “American Recovery and Reinvestment Act” that President Obama wants enacted immediately. An amendment to benefit buyers of primary residences was introduced by Senator Isakson (R-GA) and Senator Lieberman (ID-CT).

Comments from Senator Lieberman, “The rapid decline in housing prices lies at the heart of the economic crisis.”  “Real economic growth will not resume until housing values stabilize and American families once again have faith and confidence that the most valuable asset they own – their home – is safe and secure. This kind of credit could repay dividends many times over by increasing housing values, creating construction jobs, and generating state and federal tax revenue.”

The amendment was met with bipartisan support and was approved. The important provision in the amendment was the establishment of up to a $15,000 tax credit for buyer’s purchasing their primary residence.

How Does It Work?

The calculation for how to determine how much your tax credit would be is performed in this manner. Your will get a tax credit for 10% of the purchase price of the residence up to a maximum of $15,000. One of the nice provisions of the amendment is that the tax payer may choose to take the credit all in the first year or it can be split between two (2) years. One very positive feature, as opposed to the First Time Buyer Tax Credit of last year, is that this tax credit does not have to be repaid.

What Is The Timeframe?

Upon enactment of the legislation a buyer will have one year in which to complete their purchase. This sounds like a long time but in reality now is the time to start looking. The housing inventory is at a peak and your best selection for that home that meets your exact requirements may be right now.

What Are The Drawbacks?

The only drawback or downside to this amendment is that if the residence is sold or is not utilized as the primary residence in the first two years, the tax credit must be repaid. There are of course circumstances where this repayment would not apply.

John Wieland Homes has recently been awarded the J D Power New Home Builder Customer Satisfaction Award for Atlanta. This is the second year in a row for John Wieland to receive this prestigious award. J D Power uses nine factors to evaluate home builders: Builder’s Sales Staff, Builder’s warranty/customer service staff, workmanship and materials, price to value ratio, home readiness, construction manager, recreational facilities provided by the builder, Builder’s design center and location. The composite of these nine factor generate the “Overall Customer Satisfaction Rating”. For more information on how builders in the Atlanta Market rated in this study Click Here.   

Congratulations John Wieland Homes, Ya’ll Done Good!

As of July first of this year all builders and remodelers in the state of Georgia are to be licensed by the State Licensing Board for Residential and General Contractors. There are three types of contractors that must obtain a license by July 1, 2008.

*  Residential-Basic Contractor (Contractor work relative to detached one-family and two-family residences and one-family townhouses not over three stories in height).
* Residential-Light Commercial Contractor (Contractor work or activity related to multifamily and multiuse light commercial buildings and structures).
* General Contractor (Contractor work or activity that is unlimited in scope regarding any residential or commercial projects).

A fourth classification of contractor is the specialty contractor who is not required to be licensensed. This classification would include painters and roofers for example and they are not allowed to hire subcontractors.

I would think that the purpose of this law would be to help protect innocent homeowners and home buyers from unscrupulous contractors. We have all heard horror stories about homes and projects that have not worked out as originally planned. One big advantage of this law is the requirement for contractors to meet minimum standards for education, financial stability and workers compensation.

So what will the down side of this law be? Since Atlanta is so close to Florida, some of what happens there makes its way to our news programs. When a major event such as a hurricane hits Florida, it can sometimes take additional time to even get bids on getting work done much less getting the work itself performed.

The real estate market is quite unique at this particular point in time. History tells us that even though we have seen ups and downs, we just have not experienced a market like this. Increases and decreases in property values occur all the time just like the stock market. Generally speaking, over the long haul the value goes up. So what makes this market so unique?

What Happened To the Mortgages?

Up until several months ago there was a mortgage program for just about everyone. Then came the sub-prime market shake up and loan programs were reduced to some of the most basic. On top of that, investors tightened up the qualification parameters for applicants. Many first time buyers utilized 100% financing programs which went away. That breathed new life into the down payment assistance programs, which congress may soon do away with. The number of buyers who can qualify for a mortgage in today’s market has declined which therefore creates a negative impact.

Price Your Home Right

Pricing a home correctly when it first goes on the market is more important now than ever. In the past sellers market, when the market was appreciating and mortgage programs followed freely, it was an accepted practice to price your home slightly above value to allow some negotiating room. In today’s buyer’s market this just is not the case. As a seller you don’t want to put yourself in the position of “Chasing the Market”. So how do you avoid this pitfall? The easiest and most comprehensive way is to have your home appraised by an independent third party who is a licensed appraiser.

Help Buyers Buy Your Home

What other factors influence a buyer’s decision of whether or not to make an offer on your home? The main ones are appearance, appearance and appearance. Make sure that the exterior is inviting, remember you only get one chance to make a good first impression. Removing clutter and having clean carpets along with fresh paint will help tremendously. If your home is not in show ready condition and properly priced it is almost certain that you will be chasing the market instead of having the market chase you!

How would you like to receive a letter from your homeowner’s association that starts out like this? During a recent inspection it was noted that you were in violation of the Covenants and Architectural Guidelines for the following reason:

General Maintenance – Paint Metal Roof: "Each homeowner shall keep and maintain each Lot and Structure owner by him, as well as all landscaping located thereon, in good condition and repair…"

Specifically please paint the metal roof on the front of the house to match the shutters.

We will recheck your property in approximately twenty (20) days from the date of this letter. Please note that violations that are not corrected by that date or continue to be repeat violations will incur a fine of $25 per day. The association has the right of abatement (the right to correct the violation at your expense) and the right to membership suspension. Please refer to the Covenants.

In my subdivision many of the bay windows and Queen Anne returns are covered with copper. Now if the copper roof is to be painted the same color as the shutters, then just on my cul-de-sac of 7 homes there would be grey, taupe, reddish orange, blue and black painted copper. I think it is easy to visualize just how silly that would look. Obviously the individual that wrote this letter was not very well versed about copper roofs and their maintenance. For those who don’t know as it ages, copper naturally goes through several stages. Rather than educating themselves first, it is sad that the homeowner’s association just sent out this letter for no good reason.

After several phone conversations and countless hours of research obtaining documentation about copper roofs along with emailing these documents to the homeowner’s association the violation was dropped. The resident was guilty until proven innocent. Seems a bit backwards from the way we have all been brought up don’t you think? Below you will see a picture of a monument that started out as bright shiny cooper and been going through the aging process for some time. I think we can all agree that it would be a shame to paint this structure.

Update for Down Payment Assistance in Atlanta

The Nehemiah Program

This morning I had the privilege of attending a seminar about down payment assistance and how it can benefit both buyers and sellers in the greater Atlanta market. The seminar was taught by Leslie Kane, Area Manager, of The Nehemiah Program. The Nehemiah Program is charitable organization that has helped over 40,000 families in Georgia achieve their dream of home ownership.

The Nehemiah Program began in Sacramento, California in 1994 and was designed to help a particular community become more stable. The program gets its name, Nehemiah, from a biblical figure that helped rebuild the walls of Jerusalem and since the program was being utilized to help rebuild a community it just seemed to fit.

How Down Payment Assistance Works

If a buyer is qualified to purchase a home using FHA financing then they are automatically qualified to purchase a home using the Nehemiah Program. The home being purchased must be owner occupied and can be single family, duplex, triplex, quadraplex or a FHA approved a condo. With FHA loans the buyer is required to make a minimum down payment of 3% of the loan amount. By utilizing the Nehemiah Program the seller contributes the down payment for the buyer. At the time of entering into a contract with a buyer for the purchase of the home, the seller agrees to contribute the down payment and a small processing fee to the program. This is accomplished using the Participating Home Agreement form from Nehemiah. The program in turn contributes the down payment for the buyer. The buyer completes a Gift Letter form detailing where the gift funds came from and what address they will be used for purchasing. This type program can only be performed by a charitable organization. (Sellers are only committed to pay the contribution and fee if a buyer utilizes The Nehemiah Program to purchase the home.)

Who Benefits From a Down Payment Assistance Program?

The Nehemiah Program is helping both buyers and sellers in the greater Atlanta market. Obviously buyers benefit by being able to purchase homes with little or no money out of pocket. Generally speaking this type program would be for buyers with credit that is good enough for them to be able to purchase a home but they lack having the funds for a down payment. Typically prospective buyers who are currently renting or living at home are good candidates for this type program.

Sellers are also benefiting from this program. With the recent increase in FHA loan limits to $346,250 in the metro Atlanta area and $271,000 in outlying areas, more home sellers find themselves in a position to participate in this type program.

Who Qualifies For Down Payment Assistance?

As was stated earlier, if a buyer is qualified to purchase utilizing a FHA loan then they are automatically qualified to participate in this down payment assistance program. To find out if you qualify for FHA financing and down payment assistance Contact Mack.

So what exactly does the FHA do? The FHA provides mortgage insurance on loans made by FHA approved lenders throughout the United States. Since it inception in 1934 FHA has insured more that 34 million loans. Generally FHA loans are easier for buyers to qualify for as they do not have the more strict underwriting guidelines of conventional loans.

We have known that it was coming, we just didn’t know how high the limits would be raised. Well we got the answer today. The Federal Housing Administration, FHA, has increased the loan limits on a FHA insured home loan in Metro Atlanta to $346,250 up from $252,890, an increase of 27%.

This action by FHA should help spur the housing industry in the Atlanta market. Any home priced below $346,250 just became easier for more buyers to qualify for.

The Atlanta Real Estate Market has escaped from many of the problems that have affected other major markets. It has been pointed out that the resiliency of the Atlanta market is due to our sector being fueled by jobs and relocation rather than speculative buying as has happened in some of the condominium resort areas. Just how lucky are we? Below you can see one of the policies lenders have adopted that affect buyers in other areas of the county.

In certain areas of the country lenders have implemented what is called a “Declining Markets Policy”. In essence what this policy calls for is for buyers, purchasing property in what the lender has identified as a declining market, to increase their stake in the property. Most lenders are requiring the loan-to-value (LTV) ratio if one loan is being utilized or the combined-loan-to value (CLTV) ratio if multiple loans are being utilized to be reduced by five (5) percent.  An example would be rather than being able to obtain 100% financing in a declining market, a buyer could only obtain 95% financing. The exception to this policy would apply for FHA and VA loans. For these government backed loans a second level underwriter review is called for, thus making qualifying more difficult.

Lenders are identifying the declining markets by both city and county in the various effected states. Several sources are being used to determine which areas are included. Standard and Poors Case-Schiller Home Price Indices, The Federal National Mortgage Association, The Federal Home Loan Mortgage Corporation, The Office of Federal Housing Enterprise Oversight Index along with statistics from The National Association of REALTORS are the most common sources used in identifying these areas.

Not only are there declining markets, but several of the lenders are also looking more closely at what have been identified as “Soft Markets”. While these areas are not as drastically affected, the lenders are requiring a second level underwriting review for soft market identified locations.

In the latest report I have been able to obtain, the Atlanta Market has not been identified as either a declining or soft market as defined by these lender guidelines. This doesn’t mean that the buyers market is gone. It just suggests that the Atlanta Market has not been as decimated as some of the other major metropolitan markets. Conditions remain favorable toward buyers with sellers making considerable concessions and interest rates remaining low. To find more information about Homes for Sale, just let me know what your requirements are. I am here to help.

It’s A Buyers Market

If you didn’t know it before, you certainly will know it now by way of the most current stats for real estate in the Atlanta Market. Unfortunately for sellers 2008 has started much in the same fashion that 2007 ended, with a market that continues to decline. Inventory continues to increase and the average days on the market for single family homes is at it’s highest level in 10 years at over 101 days on the market.

Available Inventory Increasing

Here are some of the facts comparing months supply of available homes 1-2006 vs 1-2008:
New Single Family Homes up over 81%
Resale Single Family Homes up over 91%
New Condos and Townhomes up over 125%
Resale Condos and Townhomes up over 26%

Additional Good News for Buyers

The other factor that generally goes hand in hand with increasing days on the market and additional inventory is an overall average price decline of sold properties. The situation at this time confirms this factor. The average sale price for both single family residences and condo/townhomes declined in January.

Even More Good News

If you take the abundance of inventory to choose from and the lower average prices then add to it the notoriously low interest rates, you now have all the components of a full fledged buyers market in Atlanta. Sellers are saying bring all offers. Why don’t we get together and help them sell their home at a deep discount?