Are we facing another Housing Bubble?
Are we facing another Housing Bubble? Or, is this just the "NEW" Market Correction? North Metro Atlanta started a downward decline in housing prices around 2007. Foreclosures and Short Sales started becoming the norm in 2008 & 2009 and by 2010, we were in a full blown housing market crash. By 2011 and 2012 many home owners were facing value declines as much as 25% and housing prices were at a 10 year low in North Metro. Thus, investors of all sorts (individuals, large corporations, foreign and all...) saw great opportunity at this time and the buying frenzy began! Bank owned properties that had been sitting vacant and cold started landing multiple offers. REO agents were excited but overwhelmed with the large numbers of offers they were receiving. Rules had to be invoked by the Federal Government to keep the investors at bay so owner occupants could have a fighting chance. CASH being KING created an opportunity for home sale prices to finally begin increasing, as appraisals weren't necessary for these hungry investors. Today, competition has become so fierce that even auction sites have taken off in popularity. Buyers are bidding, sight unseen, far above current market values, in an effort to "win" the bid and get their slice of Real Estate. Investors today aren't paying market value for real estate, they are paying future assumed market values.... in other words, I believe we are in the beginning stages of an inflated housing market for North Metro Atlanta. The question or concern I have is this...are we witnessing another bubble bound to bust and send our market crashing once again or is this simply a market correction to repair the damaged prices caused by the last 7 years? Let's look at the current conditions: Investors who are paying cash are leading the charge to increasing our home sale prices and they are buying in ALL categories...all types of homes, all price points and in all conditions. This in turn has paved the way for owner occupants to obtain loans as they are now having no trouble getting the home to appraise. This is a far cry from what we've been dealing with the past 5+ years. At the rate we are going, I believe we may have inflated prices by 2015, as we will recover all the losses incurred in the last 7 years by the end 2014 and we may possibly see an additional gain of 10% - 15% by 2015. Right now, auction sites and Multiple Listing sites are full of high bidding, cash buying investors, anxious to get their hands on as much real estate as they can. Can our market sustain this type of demand and growth, this fast? I suppose only time will tell. Here's my recommendation to Buyers and Sellers right now .... If you've been wanting to sell your home and turn around and buy another, don't wait any longer. If you've been wanting to buy a home and haven't made the proper steps to do so, you best do it now! And lastly, if you are an investor be careful... Do not to get too far ahead of the prices. It is easy to get caught up in the feeding frenzy! To learn more, contact Melanie Gurley. She'll help you navigate through this exciting, ever changing Real Estate Market! Melanie@TheGurleyTeam.com Direct: 770-596-5965 www.TheGurleyTeam.com www.MelanieGurley.com Solid Source Realty GA