A rapidly deteriorating real estate market has sent jitters down the backs of homeowners in Georgia as the nation enters the era of the new economy with less bank lending, lower leverage and higher unemployment. Homes are selling much slower in all Georgia markets than during the federal tax credit period, which demonstrated no lasting power to push housing prices higher. The job market is unlikely to offer an improvement in the next year, which will keep home values moving lower with rising foreclosures.
The increase in home sales projected by Housing Predictor from the government backed federal tax credit for home buyers proved to be another government incentive that turned out to be just a temporary measure, but at least it gave the market a sense of improving for some time. Without additional federal dollars housing markets in Georgia are projected to see higher home price deflation.
In Atlanta, the market has seen a massive drop in sales since the credit’s expiration and that trend should continue, despite near record low mortgage rates. Consumer confidence and weak employment prospects for those out of work or under-employed is discouraging news for the regional economy. Home sales should see an increase in the Atlanta metro area towards summer, but are still forecast to experience average housing price deflation of 8.2% in 2011.
In Macon, outside of Atlanta’s urban influences the housing market hit the skids earlier than some other areas of the state. Home sales are off as a result of the expired credit, and for all intents and purposes aren’t expected to improve until the job situation does. That, however, could take a number of years in the hard hit economy as employers remain leery about hiring back workers. Foreclosures are hurting the market in Macon, which is forecast to sustain home price deflation of 8.6% in 2011.
In Columbus a disappointing job market combined with high foreclosures is hurting home values. Bankers are slashing the prices on foreclosures to get them sold and the more foreclosures that sell the more housing prices go down. It’s a disturbing trend in Columbus as the community suffers through the worst real estate crash in U.S. history.
But since the community didn’t see as much of the free-wheeling Liar loans that other areas did, it stands to reason they’ll be fewer foreclosures. Home prices are forecast to decline another 6.2% in 2011 for the market.
In Augusta home sales cooled only moderately after the tax credit, but when the volume of sales is only a few hundred a month instead of hundreds or thousands it’s difficult to judge how much the market is slowing and how fast. However, high unemployment in the region hampers any prospects for growth, despite near record low mortgage rates for buyers to take advantage of in the current economy. The likelihood of any increase in sales is hampered by job losses and doubts about the present economy. Augusta is forecast to sustain average housing deflation of 7.2% for the year, which is at least partially boosted by its military installation.
Out of the hustle and bustle of the city in tourist bound Savannah, vacation home buyers should be attracted to lower priced homes as consumers come to realize the bottom of the housing market may be near. The historic community that has gained so much fame and fortune from its old tourist section covered in Oak trees attracts many residents for its high quality of life. Savannah is a diamond in the rough of the old south, attracting visitors from around the world. Average home prices are forecast to decline just 4.7% in 2011.