Tag Archives: gwinnett

Buy New? Resale? Renovations?

Wednesday, 10 April 2013 10:05

Written by Lane Bailey

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As a buyer, it is a tough choice. New construction in South Forsyth and North Gwinnett are ramping up at an amazing pace. All of the “PVC farms” that were left in the wake of the crash a few years ago are either already holding homes, or on the way to it. Builders are pushing crews, and they still have a hard time holding standing inventory.

Interest rates are incredible. Prices are affordable.

But inventory is problematic.

What is a buyer to do? A couple of years ago, there were likely scores of homes that met your basic requirements. Looking at 4 car garage homes, in Gwinnett, just a couple of years ago there were probably 30 at any given time between $200k and $400k. Today there are just a handful.

First… if you are serious, don’t make the mistake of waiting if you really like the house. If it is reasonably priced, it WILL sell and it won’t take long.

But each of these segments has pros and cons.

New Homes…

They have that new home smell… and a warranty… and since you likely aren’t buying standing inventory, you can specify finishes and colors and floorplans. That rocks. But, you WILL pay for every one of those upgrades. Even if the builder is offering “$25,000 in free upgrades”, they ARE built into the cost of the home.

That doesn’t mean it won’t be worth it. It might be the best option. It is easy. Make your selections and let it happen. Of course, the drawback is that you aren’t in control. You have to wait until it is done. That could be a few weeks or a few months. And builder contracts are often stacked so that you can’t push on them if they fail to meet deadlines. Some aren’t… but many are. There might also be other hidden gems in the contract that prevent you from getting exactly what you want. Most of the time it works out, but there is that small percentage where the buyer gets bit.

Resales…

What you buy is what you get… And that is also a knife that cuts both ways. On one hand, it is pretty obvious what you are getting. You can walk around the actual floor plan, with the “options” already in place. You can see the colors in their natural habitat and feel the finishes. And there might be more room to negotiate with an individual seller vs a builder. The builder doesn’t want to cut the price on YOUR home because that will show up in the public records… compromising his future negotiating position for that community.

However, you CAN get a warranty. It won’t be a 15 year structure warranty, but for under $500, you can get a good warranty for the first year of ownership. And you are probably saving some cash compared to buying the new home. Don’t forget, if the home is in a subdivision that is built out, you know EXACTLY what you are getting as far as the neighborhood goes.

The Purchase Contracts are generally better, too. If you are working with a REALTOR®, they should be using state “association contracts”. I use the contracts generated by the Georgia Association of REALTORS®. Non-member licensees don’t have access to those contracts unless they pay a licensing fee. And the non-member contracts are just not on the same standard. The exception to this is Foreclosures… they generally have an amendment that kills most of the protections in the base contract. In exchange, you should be getting a better deal on the property for that risk…

Recent Renovations…

These are kind of a mix between the other two… In many ways, they have the best of both worlds, except that there are going to be fewer variable to adjust. Walls probably aren’t moving even if the work hasn’t been started yet, and if it is “done” then it might as well be a resale… you probably won’t be getting the finishes changed.

But, while most of what you see and touch will be new or refinished, the price will often be less than a comparable new home. You can still get the 1 year warranty. The builder doing the conversion MAY stand behind the work they have done. Appliances and systems MAY also have longer warranties as well.

And Finally…

Buying a house ready for a renovation isn’t a bad idea, either. If there isn’t a home that suits YOUR needs, buying one that is ready for a work-over, and then arranging that, may be a great plan. If there IS a house that meets your needs, it will probably be a better plan, but often, that just isn’t the reality… especially now with the decreased inventories on the market.

If you are in the Atlanta area and would like to know more, give me a shout. If you are outside of the Atlanta area, I still might know a good local agent that could help you out with their local expertise.

Duluth, GA, Market Report, February 2013

Monday, 08 April 2013 11:17

Written by Lane Bailey

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This map shows the incorporated and unincorpor...

Image via Wikipedia

Market stats for Duluth, February, 2013 indicated that there were 287 properties on the market, up 15 from last month. Overall, there was about a 6.0 month supply of properties. Sales in February were 40, down from 65 a year earlier. Sales were also down compared to the prior month (45). Duluth had been slightly leading Gwinnett County as a whole, but not so much over the last few months. It is right in the Balanced Market zone.

In the Under $200k arena, there were 86 listings in Duluth, GA, with about a 3.8 month supply. The Absorption Rate for last February, was 5.6. Sales were WAY down this year v last year (20 v 45), but flat compared to last month (20). The Absorption Rate (A/R) is a bit better than most of the county…

Between $200k and $400k, there are 82 listings for sale, and about 5.1 months of supply. Absorption rates have similarly risen, dropped and then risen again. Sales were up compared to February, 2012 (15 v 8) but down compared to last month (16). Duluth is a market that favors luxury, but this segment is not doing as well as I would have expected… but it might be constrained somewhat due to low inventories. It is still a slight Seller’s Market.

From $400k to $600k, there were 34 homes on the market. The Absorption Rate was around 6.8 months. February brought in 2 sales. There were 8 last year and 4 last month. Unlike many of the market areas, Duluth is a luxury centric market, and it is doing better than the rest of Gwinnett County, GA, especially at this price level. Usually we see the A/R soften as we move up in price, but that isn’t happening here. We are now slightly to the Buyer’s Market side.

In the $600k to $800k arena, there were 30 listings, with about 15 months of supply. Sales were 1 for February… 1 for last year. And month to month sales were down (1 v 3). I would like to see three consecutive months with strong sales, and haven’t seen that for a while. Since Duluth does favor luxury sales, it has been looking better than the much of the rest of the County at this price level. But not the last few months…

In Duluth, GA, from $800k to $1m, there were 16 homes listed and approximately 24 months of inventory on the market. The 1 sale for February was not better than the 2 last year or the 1 last month. Sales haven’t been moving much for the last couple of months, but 2 sales for the last 3 months was the same as the same 3 months from last year (2 sale). And a year ago the A/R was 36 months.

Above $1m, there were 39 properties listed. The current absorption rate indicated about 29 months of inventory. A couple of sales at this level could have a large impact on the Absorption Rates. There were 4 sales in the Dev-Feb period this year, and 2 for the same time last year. We should be posting four sales a month here regularly… and we fell short last month but barely had a start with it this month with 1 sale. There was 1 sale last year and there was 1 for January.

Duluth, GA is a suburb of Atlanta, in the heart of Gwinnett County. It actually straddles the county line and has unincorporated portions in South Forsyth County. The population of Duluth is estimated as about 26,000 people as of 2008, but this doesn’t include unincorporated areas outside the city limits, but with a Duluth mailing address. It is also home to Sugarloaf Country Club, a PGA stop until recently. Forbes Magazine rated Duluth 26th in their nationwide survey of the best places to move, and it is one of the wealthiest parts of Georgia. It is also home to the Arena at Gwinnett Center (Home of the ECHL Gwinnett Gladiators) and the former Atlanta Thrashers practice facility (the Duluth Ice Forum). There is a LONG list of celebrities and athletes that call Duluth home, largely because of the country clubs and proximity to Atlanta.

Atlanta Metro Zillow Home Value Index

Atlanta Metro Home Values – Interactive chart

I have a page dedicated to Duluth Market Information.

Is $1,000,000 Burning a Hole in Your Pocket? (lanebailey.com)

Lawrenceville, GA Market Report, February 2013

Friday, 05 April 2013 09:24

Written by Lane Bailey

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Image via Wikipedia

Market stats for Lawrenceville, GA, February, 2013, indicate that there were 633 properties on the market, down 50 from last month. Overall, there was about a 3.5 month supply of properties. In 2012, sales for February were at 196, so 170 sales was a big decrease, year over year. Last month’s sales were at 166. Coupled with the decrease in inventory, things are still looking pretty good. Normally the market picks up from January-February through about June-August. This month we are OK, but some are arguing that constrained inventories are still holding back sales or we could be looking even better. In almost every market I follow in Gwinnett, there was an increase in listings… except here.

For Lawrenceville, GA, Homes Under $200k, there are 497 listings, with about a 3.0 month supply of homes. Sales were down from February, 2012 (154 v 181), although sales may very well be off because of constrained inventories. Last year in this segment, there were almost 1000 listings v under 500 now. This segment is easily the lion’s share of sales for the area. With the 2.99 month A/R, it is solidly in Seller’s Market territory. The low Absorption Rate (AR) is due to very strong sales, coupled with dramatically lower listing inventories. Month over month sales were flat from 154 last month. Again, there was a big drop in listed properties for this month.

Between $200k and $400k, there are 118 listings for sale, and about 7.4 months of supply. Oddly, this had one of the mid-pack segments in the county, now it’s on the weak side. The 16 sales for February, 2013 edged the 13 from last year, but killed the very weak 11 sales last month. But, we had been close but slipped back into Buyer’s Market territory here.

From $400k to $600k, there are 12 homes on the market. The absorption rate is around 12 months. However, with the level of sales in this segment, a couple of sales added or subtracted can have a HUGE impact. There was 1 sale for January but 0 sales for February, the Absorption Rate has dropped from 78 months June11, through good, but sporadic sales. This is acting like a luxury market and the A/R is jumping all over the place… with just a few sales (A/R was 34 10 months ago and 6.6 last month). While the long term trend was looking a little better, now it is still pretty choppy.

In the $600k to $800k arena, there are 4 listings, with about 12 months of supply. As with the next lower priced segment, a couple of sales makes a big difference and there were 0 sales in February. There were only 6 sales at this level in all of 2011. There was 4 sale in 2012.

Between $800k and $1M, and Above $1M there are 2 homes listed (combined) and not enough sales data to give an accurate absorption rate. Until this month, there had only been one sale in this range in the last 3 years (Aug, 2010), according to FMLS. But, there was 1 sale in July 12. It was over $1M, if that makes a difference…

Lawrenceville is in Gwinnett County, GA, just outside of Atlanta. As of the 2000 Census, there were 22,937 people in Lawrenceville, but that is only including people in the city limits, and there has been a lot of growth since 2000 in Gwinnett County (2008 estimates from the Census Bureau peg population around 29,000). It was incorporated in 1821. Lawrenceville is home to Central Gwinnett High School, and also has students that the Mountain View and Archer clusters. It is also home to Gwinnett Technical College and Georgia Gwinnett College. Another recent addition to Lawrenceville is that it is home to the Gwinnett Braves, playing at the Gwinnett Stadium on GA20 between I-85 and GA316. Possibly the most famous resident of Lawrenceville was Oliver Hardy. As a small boy he lived in Lawrenceville with his parents for a short time. Lawrenceville was also home to Junior Samples. Some of its other residents included Jeff Francouer, Brian McCann and Jennifer Ferrin.

Atlanta Metro Zillow Home Value Index

Atlanta Metro real estate info

I have a page dedicated to Lawrenceville Market Data.

Lawrenceville, GA Market Report, March 2012 (lanebailey.com)
I’m Always Up For a Good Surprise.. (lanebailey.com)
Gwinnett County Public Schools Making Changes… (lanebailey.com)

To Renovate or Not to Renovate?

Wednesday, 03 April 2013 10:25

Written by Lane Bailey

1 Comment

That is always a question…

And like most questions, there are two polar opposite answers that leave little room for anything but personal interpretation.

Don’t Do It…

The White House renovation (Photo credit: Wikipedia)

It is a pretty easy case to make. The bottom line is that there are few, if any, renovations that you can do that will increase the value of your home. About the best you can do is get back around 75-80% of the money spent on the renovations. Of course, that is assuming that you are paying someone to do the job, not doing it yourself…

Looking at Remodeling Magazines annual statistics, there are a couple of standouts, but few things will get back that much of your money at sale time. Link

So, renovating prior to selling your home prior to sale is really only a way to burn cash that you could plow into a new home…

Not So Fast…

There IS one thing about renovating that does make sense. Competition. Aside from needing to compete for buyers with the house up the street, you need to compete with new construction… now more than at any time over the last few years. Here in the Atlanta suburbs, builders are going NUTS. They are barely able to keep up with the demand, and standing inventory is hard to find.

In order to effectively compete, YOUR house needs to look its best. Those renovation may just pay back in a quick sale. And that might be worth a little lost money…

My Opinion?

Coraopolis Railroad Station (Photo credit: Wikipedia)

Don’t go nuts… Price fixes everything, and you may not have to take the same kind of hit on price as the renovation might take. Doing a $100k major upscale kitchen remodel probably would be overkill. Putting up a fresh coat of paint, however, DOES make a lot of sense.

Do NOT forget that your time IS valuable. That is one issue that I often see. People remember that the paint will cost $200, but forget that they are going to be spending 20 hours applying it. If you are going to renovate, don’t discount the value of your time to $0. Sure, you might not need to value your weekend labor at $100/hr, which some contractors WILL charge, but give it some value. Weigh that into your decision.

Next week we’ll be looking at it from the buyer’s perspective…

Buford, GA, Market Report, February 2013

Monday, 01 April 2013 11:17

Written by Lane Bailey

0 Comments

Market stats for Buford, GA, February, 2013 indicate that there were 307 properties on the market, an increase of 22 from last month. Overall, there was about an 4.9 month supply of properties (Absorption Rate or A/R). There were 63 sales for February, up from 58 last month but down from the 64 sales last Jan12. It isn’t the strongest market in Gwinnett, but the A/R is nothing to sneeze at. It is still in Seller’s Market territory.

In the sub-$200k arena, there were 140 listings, with a 3.9 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 up from last month 34 (v 32 last month), and well down compared to last year (40 sales in Jan12). But, the A/R is well under the 6 months that would be considered fairly balanced… pointing towards a solid seller’s market. This time of year we should start seeing an increase is sales… and listings.

Between $200k and $400k, there were 123 listings for sale, and about 5.1 months of supply. The 26 sales recorded were up from the 21 last month and from the 23 sales last year for February. This had been one of the weaker segments in the county, but had improved dramatically until last month it was fairly balanced, though tilted towards buyers… now it is slightly further into Seller’s Market territory.

From $400k to $600k, there were 32 homes on the market. The absorption rate is 12 Months. There have been 8 sales in the last 3 months (1 for December, 5 for January and 3 for February). When the market is rolling, there should be 4-7 sales a month during this part of the year. Just for comparison, there were 5 sales in the Dec-Feb period in 2011-12. This segment has been bouncing all over the place…

In the $600k to $800k arena, there were 4 listings. Absorption Rate is (again) 36+ 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 4 has made things look less slow… but there were 7 sales in this segment last year including 3 sales in March, 1 in June and 0 in February.

The range from $800k to $1m, there was 1 homes listed. Trends are hardly definable. Listings are down. June recorded the first sales since December, 2010. There was 1 sale in February. So it now has a 3.0 month Absorption Rate.

Above $1m, there were 7 properties listed. There was sale in the segment in April… of 2009…and then May, 2011… and 2 sales in June, 2011… also 1 in July and September. There was 1 sale in October, but 0 sales in February. So, we have 21 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).