Suburban Atlanta Housing Market Tilts in Buyers’ Favor

After several boom years for home builders, sales of new homes dropped 19 percent in Cobb County, Ga., and 8 percent in nearby Cherokee County last year. That stirs anxiety in people like with “For Sale” signs in the yard.

“The guy behind me is trying to sell his house and move to Tampa, and he can’t even get any bites,” Tom Elder said.

Elder plans to move out of the Hasty Acres subdivision of Marietta and buy a new house after getting married. He said houses in his neighborhood once stayed on the market for weeks but now may linger for months.

“I know for a plain fact that the only way they are going to sell is they drop their price,” he said. “I know we will not get the money we would have a year or two ago.”

People who track home sales say they that the Atlanta housing market is stable and that sales will pick up later this year and next.

About 9,300 homes in Cobb County and 6,500 in Cherokee County were on the market recently, according to Eugene James, the Atlanta director for Metrostudy, a company that tracks home building and sales.

To entice would-be buyers, home builders are throwing in extras such as granite countertops. They’re also offering to pay closing costs or finish basements.

Many offer such incentives when they built a house “on speculation,” or without a buyer, said Christopher Burke, spokesman for the Greater Atlanta Home Builders Association.

“They just can’t do business like they did in the 1990s — just build a home and someone will buy it,” Burke said. “I’ll doubt if we will see these kinds of incentives offered in the future.”

Area mortgage lender and builder groups also worry about the rising number of foreclosures, many the result of easy credit offered to home buyers in recent years.

The rising cost of materials and construction and the price and limited availability of land also have affected sales, in addition to rising bad credit mortgage problems.

Steve Palmer of Bowen Family Homes said rising prices and the limited land have pushed some buyers toward Cherokee and other counties.

In fact, for the first time ever, more new homes sold in Cherokee County last year than in Cobb County, said Dick Hearin, a vice president with Coldwell Banker.

“Cobb is becoming built out,” he said, though some land remains in west Cobb and developers are pursuing “infill projects between Smyrna and Marietta.”

New houses in Cobb also tend to cost a lot more in terms of Georgia home loan payments than new homes in Cherokee. About 53 percent of new homes in Cobb went on the market for $350,000 or less last year, compared with 82 percent in Cherokee.

Sales have flagged the least in the market for lower-priced homes, making Georgia mortgage loans difficult to come by for many potential seekers.

Despite the slowdown, experts believe that metro Atlanta remains affordable compared to the rest of the nation.

Homes here have appreciated at a slow, steady price rather than the huge, inflationary prices seen in markets such as San Diego or Jacksonville.

Back in Cobb County, though, these encouraging national trends are little comfort to many a home builder - or to Ann Franzell’s neighbors.

She had an offer less than two weeks after putting her house on the market, but she said that’s probably because she owned a split-level ranch at a time when such houses are in high demand. Her neighbors have not fared as well.

“There are several houses on our street for sale,” she said. “One has been on the market for over a year.”

And she’s reminded of the slow market while driving to work in Marietta.

“I’ve noticed a lot of subdivisions have started houses that are just sitting there,” she said. “They can’t move them.”

SOURCE: Atlanta Journal-Constitution