Case-Shiller Index For Metro Atlanta – May 2010
The peak of our market was July of 2007 according to the Case-Shiller index. The bottom was March of 2010. Since July of 2007, our homes values have slipped 20.98% – which is an improvement from previous lower months. The spring selling season was very active in March and April showing year-to-year increases in pendings of 47% and 28% respectively. Inventory remains down from last year but is increasing from the previous months of March & April. Remember, Case-Shiller reflects closed sales and not pended sales. We expect to see the index continue to show slight gains over the summer months and then begin to trail off in the fall and winter months. We do not expect to test the low point of March 2010. Remember, you will not know the bottom of the market until it is already passed. Our conclusion is that we are passed the bottom of homes values for Metro Atlanta but do not expect a robust recovery. We expect to see home values slowly increase over time with a few seasonal bumps along the way.
If you look at the average annual Case-Shiller index for each year, here is how homes purchased in recent years would compare to the current index:
Homes Bought in 2000 – Gain of 4.44%
Homes Bought in 2001 – Loss of 1.09%
Homes Bought in 2002 – Loss of 4.76%
Homes Bought in 2003 – Loss of 7.76%
Homes Bought in 2004 – Loss of 10.90%
Homes Bought in 2005 – Loss of 1518%
Homes Bought in 2006 – Loss of 19.05%
Homes Bought in 2007 – Loss of 19.57%
Homes Bought in 2008 – Loss of 12.09%
Yes, we are slowly climbing our way out of this unprecedented housing crisis – but we are not there yet. So where will home values go from here? The key factors that will impact our home values include the following:
- Demand From Buyers (We expect to see continued demand through spring and summer months.)
- Mortgage Rates/ Credit Availability (We expect to see incredibly low mortgage rates for an extended period with increases coming in late 2010 and 2011.)
- Supply/ Inventory Levels (We expect inventory levels to remain lower than normal.)
- Competition from Short Sales/ Foreclosures (We expect to see significant numbers of short sales & foreclosures for the next two years. However, we do not expect a flood of foreclosures that drives the overall inventory too high.)
You and your agent should be carefully watching the trends for short sales and foreclosures. Right now, home affordability is exceptional. We still have the combination of low home prices and the lowest mortgage rates in 50 years. Many wonderful properties are available below their replacement costs. But this scenario will not last forever. Rates will go up over time. Home values will be increasing – slowly but surely. Yes, we will continue to see some ups and downs along the way, but home values are on the rise. In 5 or 10 years, many will look back and regret not buying their dream home when they had the chance!
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Labels: Atlanta foreclosures, Atlanta homes values, Atlanta new homes, atlanta real estate agents, atlanta real estate market report, Atlanta short sales, Case-Shiller Index Atlanta
