The Tuesday, July 24, 20012, Wall Street Journal article “Home Prices Strengthening”, continues painting a brighter picture for the housing market. The report was based on data from Zillow, Inc, “which measures prices of comparable homes in the same community”. This measure is considered more reliable than other indexes which might be skewed by the mix of sales.
U.S. housing prices appear to be finally turning the corner. Yesterday, the Federal Housing Finance Agency’s (FHFA) reported that its home price index climbed a larger-than-expected .8% in May, exceeding consensus estimates of a .3% gain. Separately, Zillow reported that U.S. home prices posted their first year-over-year increase since 2007 in the second quarter. The Zillow Home Value index rose .2% from the second quarter of 2011 to $149,300. Residential values have gained for four months in a row, the company said. The three months ending June 30 was a “a really solid second quarter in the midst of some economic headwinds, which indicates the housing market has some organic fundamental strength on its own,” said Zillow’s chief economist Stan Humphries.
In a note to clients yesterday, Goldman Sachs wrote that the U.S. residential market has now a “long list of positives” including rising prices, supportive government policies, and a decline in the so-called shadow inventory of homes.
On July 19, 2012, The National Association Of Realtors reported that existing home prices rose in June. According to Lawrence Yun, NAR chief economist, said the “story is lower inventory and recovery in home prices.” While most reports still show Atlanta trailing the nation in the recovery process the trend line is up. For further information, view the report here.
Epic Development has worked with several clients lately that have just sold homes. In both cases our clients reported that they put their homes on the market expecting an extended marketing period. However, within just three weeks, both sellers had very competitive offers and accepted contracts. The sales period was much shorter than they expected.
Epic Development has also recently brought several new homes to market. In each case we were grateful to receive multiple attractive offers. Two of the homes traded above their listed price. Discussions with the buyer’s agent for these transactions revealed that prior to going under contract on our home, their buyers had faced similar competition attempting to buy other properties which they lost to higher offers.
Epic Development is faced with similar competitive forces when acquiring lots. We were recently the successful party for a lot located in the very much in demand Virginia Highlands neighborhood. Within 48 hours there were ten offers on the home and we had to offer a significant premium above the asking price. Our suggestion to buyers in the market right now is to bid competitively on homes you really like. Make your offer as “clean” as possible with limited contingencies, and extended closing times. The cleaner the offer the more likely it will be accepted, sometimes even when it is not the highest offer. The days of making the low ball offer loaded with terms favorable to the buyer are gone for now.
For more information about homeownership or real estate investment in Atlanta call Jim LaVallee at 404-847-9080 or write Jim@EpicDevelopment.com. You can view all our current listings here.
For more information about commercial real estate operations or investment visit EpiCity.com.