Page 1 2
Not since the Great Depression of the 1930s has the national median home price declined. Think about the
difference in the trading of homes versus financial instruments. Homes trade far less frequently than
equities, as most homeowners sell homes once every seven to 10 years. Home prices don’t fluctuate like
stocks do, nor are there panic sells in the housing market. During the plummeting Dow Jones and NASDAQ
averages in October 2002, the housing market remained strong.
In the Atlanta market, the recession of 2002 and 2003 caused job losses in the area, creating an
oversupply. Those who were enticed by interest-only loans or adjustable rate mortgages, which accounted for
44% of loans, may feel the pinch over time from higher interest rates.
From a positive standpoint, Atlanta has added almost 9,000 new jobs in the past 12 months. Our local
technology industry is bouncing back and creating more job growth. These new residents and employees
influence the housing market’s growth and appreciation rates.
Atlanta has a favorable home price-to-income ratio, at 1.7. Conversely, only 19% of home loans have
loan-to-value ratios above 90% . So the risk factors are minimal.
Intangible factors are at work as well. Atlanta’s international airport, weather, affordable neighborhoods,
churches and other religious institutions, major league sports teams, and high-profile cultural institutions
continue to attract newcomers. The opening of the High Museum expansion designed by Renzo Piano has captured
national attention, while attention on the Georgia Aquarium as the world’s largest marine-life facility has
dominated international media.
Home ownership in Atlanta translates into a wonderful style of life and an unbeatable investment. We
expect both to become even better in years ahead.
 Previous Page | Top
|
