Buford, GA, Market Report, December 2011

0 Comments
This map shows the incorporated and unincorpor...

Image via Wikipedia

Market stats for Buford, GA, December, 2011 indicate that there were 434 properties on the market.  Overall, there was about an 6.4 month supply of properties (Absorption Rate or A/R).  There were 83 sales for December, way up from 44 last month and even up from the 62 sales last December (2010).  It isn’t the strongest market in Gwinnett, but it is much better than it has been.

In the sub-$200k arena, there were 247 listings, with a 5.5 month supply.  This is the largest price segment in this market area, so strength here usually equals strength across the whole local market area.  Sales were well up from last month (53 v 30), but flat compared to last year (41 sales in December, 2010).  Framed in the results for the whole market area, the segment is reasonably strong.  And the A/R is under the 6 months that would be considered fairly balanced… pointing towards a slight seller’s market.

Between $200k and $400k, there were 138 listings for sale, and about 7.0 months of supply.  The 25 sales recorded were well down from the 11 from last month and from the 16 sales last year for December.  This had been one of the weaker segments in the county, but has improved dramatically and at current A/Rs, it is one of the stronger $200k-$400k segments in the county.

From $400k to $600k, there were 26 homes on the market. The absorption rate is 7.8 Months.  There have been 10 sales in the last 3 months (3 for October, 3 sales for November and 4 sales for December).  When the market is rolling, there should be 5-7 sales a month during this part of the year.  September was pretty strong, and but we didn’t have the follow-up the next two months I was looking for… December is back in the right direction, and the drop in listings certainly helps.  Just for comparison, there were 4 sales in the Oct.-Dec. period in 2010.

In the $600k to $800k arena, there were 6 listings. Absorption Rate is 18 months… but it jumps around a lot.  Sales in this range are pretty sporadic, but steady when looking at the long-term.  The drop in inventory over the last few months from 14 homes to 6 homes has made things look less slow… but there have been 5 sales in this segment in the last year… the last was five months ago until the 1 sale in December.

The range from $800k to $1m, there were 7 homes listed. And with only 2 sales in the last year (December, 2010), obviously trends are hardly definable. Listings are down, but sales aren’t following through.

Above $1m, there were 10 properties listed. The last sale in the segment was in April… of 2009…and then there was May… and 2 sales in June. So, we have 37 months of inventory. I hope, but am not expecting, sales to be more consistent.

Buford, GA is a suburb of Atlanta in Gwinnett and Hall Counties. The population is 2000 was 10,668, but that only included the area inside the city limits, and it had seen tremendous growth since that census. Buford is home to Lake Lanier, one of Georgia’s premiere recreational areas, and Lake Lanier Islands. Recently, the City of Buford has revamped their old town. It is also home to Buford (Buford City Schools aren’t a part of Gwinnett County Schools), Mill Creek, Mountain View and Lanier High School (Lanier will open for the 2010-11 school year).

I have a page dedicated to Buford Market Data.

Related articles
Atlanta Metro Zillow Home Value Index

Enhanced by Zemanta
Amplify

Wayback Wednesday… The Bigger Price Myth

0 Comments

This is one of those things that I hear about all of the time.  I face it all too often.  I go on listing appointments and either an agent before me, or one that comes later “buys the listing“.  Of course, not literally, but figuratively.

They tell the seller what the seller wants to hear… regardless of reality.  They tell the seller that they will sell the house for more money.  It is an appeal to the ego… and sometimes even defies logic.  But, it gets the listing.  Obviously, the seller generally wants to hear that their house is worth more.

It usually happens for one of two reasons… the innocent one and the not so innocent one.

The innocent reason is that the agent just doesn’t know any better.  Through inexperience or bad data or poor technique working with the data… or even misreading the market climate… they arrive at a price that isn’t really realistic.  And the window for a price is pretty small.  At 20% over real value, the house likely won’t be seen in the current market.  At 10%, many of the prospective buyers will dismiss the house even if they come look at it (most buyers won’t make a serious offer more than a few percent off of the list price).  Even at 5% over reality, many prospective buyers won’t offer… or they will push it to the back of the line.

The “not so innocent” reason is that the agent KNOWS that the sellers will list with them if they give a higher price estimate.  It is a LOT more common that most sellers would think.  In fact, there is an entire sub-industry in real estate involving strategies and support for these agents.  One of the popular strategies is to build in price reductions at predetermined intervals.  The sellers should ask a simple question… “If you are confident of the price, why would you build in price reductions?”  Of course, the market DOES shift, sometimes unexpectedly.

The idea, as stated in much of the materials supporting this strategy, is that the agent can tell the seller, “OK, we’ll try it at your price, but if nothing happens in 30 days, we’ll cut the price to ____.”  There is always the chance that there will be a buyer that will drop out of the sky, with cash (since the asking price might not clear an appraisal) and no desire to have an appraisal of their own done.  But… not that likely.  And that is where the issue I take with this as a deliberate strategy begins.  We know, from tons of studies, that over-priced houses generally end up selling for less, after spending more time on the market.

It goes like this…

  • The house starts off as over-priced, so it gets fewer, if any showings.
  • After a period of time, the price starts to ratchet down… but it has already missed that magic window (when a house is first listed) when the most buyers look seriously at it.
  • Since it has been on the market longer, the buyers that DO run across is wonder WHY it has been on the market so long.
  • Vicious cycle…
  • Price gets cut more to get showings.
  • When the offer comes in, it is lower than it likely would have been to start with.

Here is the post I wrote about this very issue a couple of years ago.

Related articles
Enhanced by Zemanta
Amplify

Sugar Hill, GA, Market Report, December 2011

0 Comments
This map shows the incorporated and unincorpor...

Image via Wikipedia

Market stats for Sugar Hill, GA , December, 2011 indicates that there are 158 homes on the market.  Overall, there is about an 5.0 month supply.  There were 31 sales, compared to 34 last month and 28 last December.  The Absorption Rate (AR) dropped, but that is largely due to the decrease in listings.

For Sugar Hill homes priced under $200k, there are 118 listings, with about 5.0 months supply.  There were 24 sales this December, slightly less than last year for the same time (25).  Last month there were 29 sales.  Inventories have been fluid, rising and falling.  Normally, this time of year we see inventories leveling out, but this month there was a slight decrease.

Sugar Hill Listings between $200k and $400k, there are 34 listings for sale, and about 11.3 months of supply.  Last December there was an 17.2 month supply.  Last December there were 3 sales, this year there were 7.  Last month  had 2 sales.  This segment had a HUGE turnaround this month compared to the last few months.  The 3 month rolling average of sales was WAY up and the inventory was down.

For listings in the $400k to $600k range, there are 3 homes on the market.  The absorption rate is around 3 months, but with 4 sales since last October (until November), it is tough to calculate accurately.  Obviously, a sale or two could make a BIG difference, and we had 3 more sales in November alone, but none for December.  That brought the total sales for the year from 4 to 7.  There were only 3 sales in this segment last year.  I still hope to see some consistent activity in this segment.

In the $600k to $800k, $800k to $1m and Above $1m (combined), the sales are too inconsistent to have a solid read on, but there are only 3 homes listed for sale in that price range. No sales have been recorded in the last 2+ years.

Sugar Hill, GA is a suburb of Atlanta in Gwinnett County. The population is 2000 was 11,399, but that only included the area inside the city limits. The name comes from a bag of Sugar that spilled on a hill while in transit between Cumming and the railroad in Buford. And while it is actually a big market, it is in the shadows of Lawrenceville, Duluth and Suwanee… which all are nearby. That also makes it a great location, as it is close to everything that Gwinnett County, GA has to offer.

I have a page dedicated to Sugar Hill Market Data.

Atlanta Metro Zillow Home Value Index

Related articles
Enhanced by Zemanta
Amplify

Lilburn, GA Market Report, December 2011

0 Comments
This map shows the incorporated and unincorpor...

Image via Wikipedia

Market stats for Lilburn, GA, December, 2011, indicates that there were 380 properties on the market (as of December 31st).  Overall, there was about an 7.4 month supply of properties and 54 properties that closed (sold) in December.  It was an increase from last year’s sales (31) and from November, 2011 (41 sales).  The Absorption Rate notched down significantly.  Lilburn had been among the weakest of Gwinnett County, GA, cities I track.  But, at 7.35 months of inventory, it isn’t nearly as bad as it had been just a few months ago (14.35 months of inventory in Feb, 2011, for example).

In the sub-$200k arena, there were 275 listings, with about an 6.3 month supply with 43 sales.  This represents most of the sales in the market area.  Sales increased markedly from last month (36), and were also up dramatically from last year (31).  While the Absorption Rate isn’t as low as many other areas, sales are strong, and I’m still pulling for a comeback for Lilburn.  But October was quite strong, November was actually below expectations.  December was back on track.

Between $200k and $400k, there are 96 listings for sale, and about 12.5 months of supply.  This segment had been quite weak for months, and has stalled a little.  There were 11 sales compared to 0 last year.  This segment really needs to get back into single digit A/Rs … but, Lilburn has never been seen as a luxury market.  But the decrease in listings has really helped.  I’m still not as confident about this portion of the Lilburn market coming back quite yet…

From $400k to $600k, there are just 3 homes on the market. The absorption rate is 9.0 months. There were no sales in this segment from December through February, but there were 2 in March, which really turned the segment around, followed by 1 sale for April. May posted 2 sales, 1 sale in June, 2 in July and none since.

From $600k to $800k, $800k to $1M and Above $1M, there are 6 listings (combined), but too few sales to have any sort of reliable number of months of inventory. March posted the first sale since August, 2010. It was in the $600-$800k range. One of the listings is above $1M and one between $800k and $1M, and there is no market activity in the last 12 months for those ranges…

Lilburn is in Gwinnett County, GA, just outside of Atlanta. As of the 2000 Census, there were 11,307 people in Lilburn, but that is only including people in the city limits, and there has been a lot of growth since 2000 in Gwinnett County. It was incorporated in 1910. Lilburn is home to Parkview High School, and also has students that the Brookwood, Berkmar and Meadowcreek clusters. It is also home to Killian Hill Christian School, Providence Chrisian Academy, St. John Neumann Catholic School and Parkview Christian School. Possibly the most famous resident of Lilburn is General Beauregard Lee, a groundhog with a better winter prediction record that Puxatawnee Phil up in PA. Dominique Wilkins, formerly of the Atlanta Hawks also lives in Lilburn.

Atlanta Metro Zillow Home Value Index

I have a page dedicated to Lilburn Market Data.

Related articles
Enhanced by Zemanta
Amplify

Wayback Wednesday… Over-Pricing and Under-Offering

0 Comments

If there were two issues I’d have to put at the very top of my question pile, there would be the ones…  In the original post, I started with the Sellers… so we’ll start with the Buyers this time.

Buyers want a great deal.  We all understand that, and as a real estate agent, I’m supportive.  Even the Sellers get it.  But there are two problems.  The first one I wrote about in a couple of years ago, here.  Buyers, in their zeal to get a great deal, offer too low to start with.  The find a property where the price has been cut to the bone, and then they offer WAY lower.

The problem there is that the seller, whether institutional, or a “regular” seller, doesn’t see the low-ball offer as being serious… then they attach the same feeling to the buyer that made the offer… they aren’t serious.  And the seller, if they send back a counter offer, reply with a counter offer that shows that… like maybe knocking $100 off the price.  Negotiations stall.  That doesn’t help them get the house… and it wastes everyone’s time, including their own.

A few years ago, when I originally wrote the post, there was blood in the water, so to speak, and it was still an issue.  Now, especially at the entry-level end of the market, that is NOT the case.  It is actually a Seller’s Market for homes that are priced well.  I am seeing an increasing number of listings selling for VERY close to list price within days.

Sellers want to get the most from their house.  It doesn’t matter if they are a corporate seller or someone moving to take advantage of a job opportunity… or even a seller doing a short sale.  Of course, just as the sellers aren’t terribly concerned with the needs of the buyers, buyers don’t really care about the needs of the seller to get top-dollar for their property.  And buyers aren’t looking at many over-priced properties. 

They know which properties are over-priced, too.  More and more, I’m seeing buyers that are VERY sophisticated in terms of knowing the value of a particular property, usually before choosing to look at it the first time.  If it isn’t priced within a few percent of where it should be, they probably won’t even look at it.  Not 10%… not even 5%.  More like 2-3%, closer on higher priced homes.

The end result, is that the home sits on the market for a while with few, or even no viewings, much less offers.  After a while, the sellers reduce the price, but by then the home is stigmatized.  The price drops more.  In the end, the home sells for less that it might have sold had the original price been more competitive. 

 

What about short sales?

They are the new wrinkle.  And I didn’t really address them the first time around.  But some similar rules apply…

Sellers, price realistically for the market.  Don’t worry about what the bank will accept, worry about a price that will get an honest contract.  Realistically…  Not too high OR too low.  Anything else is a waste of everyone’s time.

Buyer, offer realistically.  A rule of thumb I use on short sale offers is that if the offer isn’t going to be within a couple of points of the list price, don’t bother.  If the list price is insanely high or low, don’t bother.  If you can’t afford to sit on the offer, waiting as much as six months for the bank to get their act together, don’t bother.

I know that is harsh, but it is reality.  I actually have a partner that is VERY successful at getting short sales sold.  It isn’t easy or fun for anyone…  But, it might beat the heck out of some of the alternatives for the seller, and offers great opportunity for the buyer.

Amplify

« Older Entries

Free Updates!

Subscribe
Font Size
[ Reset Settings ]

History

© 2007-2012 Lane Bailey All Rights Reserved -- Copyright notice by Blog Copyright