Housing Market Not as Bad as Media Portrays
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Every time you pick up the local newspaper or tune into your local or national news programs, there is an overwhelming theme that the housing market has collapsed and buying a home is the worst thing you could do or that there is no way you can sell your home in this market unless you discount it by 20%.
This simply isn’t true. John Adams wrote a great article home prices in the Atlanta market and really pointed out some great facts. Unfortunately, the article was on the last page of the Sunday AJC Homefinder, so not sure how many people even made it that far. Which is a real shame that every other article on the demise of the real estate market has been front page news.
One of the points that Mr. Adams made in his article was simply highlighting that much of the media buzz is based on national statistics, which can be heavily weighted by markets such as California and Florida which have experienced speculative inflationary pricing over the last few years and as a result will naturally have a correction.
While the Atlanta home market typically sees annual price increases in the 3-5% range, those markets were seeing 50% increases. Now I don’t remember anyone in the Atlanta area claiming that our prices should have also been increasing at a 50% rate, so I can’t figure out why everyone now thinks that prices are going to tumble dramatically.
“One interesting result of this most recent survey is that 18 of the 20 cities showing the lowest appreciation nationwide were located in either Florida or California. It seems that price declines are largely limited to those areas that experienced the most unrealistic price run-ups in the recent past.
One of the significant conclusions that can be reached is that the residential real estate market is not as bad off as the media would have us believe.”
I felt that the article was a fair picture of the market. It didn’t state that the market was great and that all was well in the world, but it also didn’t speculate that the housing market is collapsing. It was a well-balanced perspective on the current market.
Probably most important to remember, is that real estate is local and not national. And by local, even to base statistics on Atlanta can be difficult. For example, the housing market in East Cobb is not linked to the real estate market in Suwannee. Buying a $500,000 Smyrna home is not the same as buying a $500,000 Buckhead home because the market fundamentals are different, the amount of inventory is different, the prospective buyers are different and the days on market are vastly different.
Click here to see John Adams’ Atlanta housing market article in its entirety.
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