Although the economy isn’t out of the woods yet, the local housing market is showing signs of improvement.
“In the first six months of this year, we sold more real estate than we did during the first six months of last year,” said Frank Norton Jr., president of The Norton Agency in Gainesville.
“The first four months were probably related to the tax credits, but even after (the credit expired in April) we still sold more real estate than the same months last year.”
And although prices today are lower than they were during a real estate peak in 2006, overall market conditions are less volatile than they have been in recent memory.
“The prices of homes in the $225,000 and under range have stabilized. And in some elementary school districts — mostly in south Hall — prices have started to rise slightly,” Norton said.
“We estimate that the prices of some homes will rise as much 3 to 5 percent this year, and maybe as much as 7 percent next year.
Great schools are attracting families and there has been limited new construction, so that is helping to stabilize the market.”
Nationwide data supports local patterns. According to the U.S. Census Bureau, out of 30,000 homes sold nationwide in June, around 22,000 of those homes sold for less than $300,000.
“We’re still seeing foreclosures, but we’re selling as many as are being foreclosed,” Norton said.
Although overall construction rates are down, Newland Communities — the developers behind Sterling on the Lake in Flowery Branch — have brought in another building partner. The new builder — D.R. Horton — will offer one- and two-story homes starting at around $180,000.
“The demand for a greater product diversity has gone up,” said Patrick Clark, Newland vice president and general manager.
“(D.R. Horton) brings in a different architecture style and also more diversity in price.”
Other homes in the community range in price from the low $100,000s on up to more than $500,000.
“The supply and demand for homes sort of correlates to the price point of the house. Whereas other price points have stabilized and even increased, we’re still seeing the prices of homes over $750,000 continue to fall,” Norton said.
“Some of those houses are still selling, but it’s as if the people who can afford to buy them have put on a mask and pulled out a gun. The average sale prices of those homes have been a lot lower.”
In some extreme cases where the property is bank-owned or the seller is in distress, Norton said some of the “super high priced” homes have sold at a 30 to 40 percent discount.
“We’re selling more smaller houses these days — traditional homes haven’t lost that value like the more expensive properties have,” Norton said.
Falling interest rates for mortgages have also influenced the real estate market. Currently, the fixed-rate for a 30 year mortgage has dropped to around 4 percent — a low Norton has never seen before in his more than 30-year career in real estate.
“It’s an incredible value. We project that the rates will most likely hover below 5 percent through the fall,” Norton said.
“Over the course of the next couple of years, we’ll probably see it go back up to 6 or 7 percent. Now is certainly an interesting window of opportunity.”