Atlanta Leads Nation in Home Value Declines (Columbus, Dunwoody: low income, student loans)

[LynnHarris]

The truth of the matter is no matter if you earn a million dollars a year or twenty thousand dollars a year, the individual applying for the mortgage is the ONE that is responsible for accepting the loan. While I do agree that some banks try to encourage home buyers to select a certain type of mortgage, it is still the customer's responsibility to say "no".

When my husband and I purchased our home several years ago, we were told that we qualified for a $360,000 loan. Had we taken it we would be homeless today.

[Forrest Of Deen]

Originally Posted by weort

combination of things:

Atlanta is over built
Atlanta does not create high paying jobs anymore
Atlanta is losing its edge to regional peer cities


This is not the story of many cities in the nation which some are in recovery. "ATL" is still declining.

Is Atlanta really falling out of favour that quickly amongst most Americans? I'm quite shocked to read that property values keep plummeting there, especially when compared to here in California.

[Forrest Of Deen]

Originally Posted by johnatl

I can name companies from Tampa, Raleigh and Cleveland that have moved their HQ's here over the last year.

I bet you can't name ONE company from here that has left for any of these places. As a matter of fact, how about you name ONE company that has pulled up stakes and left Atlanta for anywhere recently?

Didn't Wendy's move their headquarters back to Ohio from Atlanta this year?

Wendy's HQ Leaving Atlanta for Ohio - ABC News

[arjay57]

Originally Posted by Forrest Of Deen

I'm quite shocked to read that property values keep plummeting there, especially when compared to here in California.

It just depends on where you are. Many neighborhoods are doing great.

[koko339]

Originally Posted by anothertntony

Recent transplants are often potential transients due to economic uncertainty. I am in this category. My job is somewhat dependent upon congressional funding for a specific sector (i.e., deep cuts in that sector would likely put me into job hunting mode). I would actually be fine with such cuts occurring, although I would prefer to see them phased in over a few years rather than imposed abruptly.

If I were to re-enter the job market, then I would very likely land on the west coast and not in Atlanta. Thus, although I would like to stay in Atlanta, it may or may not be practical, even in the short-term (1-2 years). Even worse, whether or not I stay is largely up to a Congress incapable of bringing even a small amount of clarity to the immediate budget, much less the budget a few years from now.

Thus, although I have enough for a twenty percent down payment and by most measures should be in the first time home buyers category, I will sit on the sidelines for the foreseeable future because I need the flexibility to pick up and move on very short notice. Almost everyone that I know in my age group is in a similar boat.

You and me both. I'm financially able to buy my first home, but I just can't stomach it. I think home ownership has lost a lot of its luster for my generation.

[chiatldal]

Originally Posted by Forrest Of Deen

Is Atlanta really falling out of favour that quickly amongst most Americans? I'm quite shocked to read that property values keep plummeting there, especially when compared to here in California.

Naw this is just another doom day wishful thinking thread. Where posters who want Atlanta to do bad, boast and overstate negatives, just the usual.

Example when threads like these pop up, these same posters are no shows. By the way all of these articles and threads are less then a month old, most under 2 weeks.

Atlanta's Unemployment Rate Drops Drastically to 9.2%. How much is attributable to Hire One Atlanta?

The Sun Belt's Migration Comeback: Good News for Metro Atlanta

Atlanta ranks #1 for best cities for minority entrepeneurs

Rumors of Atlanta's demise are exaggerated and premature

The funny thing is just like the OP link, they are lead by Atlanta Business Chronicle links also.

This is another recent thread also, It wasn't lead by a ATL biz link but they do have a article.

Metro Atlanta’s Net Employment Outlook; Fourth-Best in Nation.

Manpower: Atlanta has better job outlook for 2012 - Atlanta Business Chronicle

Here's some stuff that never got a thread.

New home construction coming back slowly - Atlanta Business Chronicle

An industry in motion - Atlanta Business Chronicle

State?s growth and jobs to edge up in 2012 - Atlanta Business Chronicle

Housing development, bold ambitions return - Atlanta Business Chronicle

and etc

[lastminutemom]

The challenge with housing prices, here and certainly other places, is that many of the people moving in the last decade or so, brought at the top of the market, and now are stuck. Whereas, in places where growth has been slower, the price drops have been less dramatic. I know many people who purchased homes in 2004, 2005 who really want to leave the Atlanta area and they feel stuck.

One of the most subtle changes to the real estate market, in my opinion, is the fact that people aren't looking to "move up" right now. Before the market slowed, people were regularly "moving up" to larger, more expensive homes often just within a few miles of where they lived. I live in a neighborhood where the median price is probably high 300s (down from 420s-450s). Almost every home that has sold in the last 18 months has been to someone from out of state and almost everyone moving has been leaving for employment outside of GA.

I am skeptical of the jobs report. We own a smallish business and while we are hiring it is simply to replace people who have found other jobs, again not in GA. We are in an industry with unemployment under 4 percent, so finding people is challenging and we will most likely have to hire from out of state. Many of our fellow business owners report the same thing, not much job creation, mostly filling positions as they come open.

I do think that people who have been delaying retirement, will eventually give up waiting for better economic conditions and retire. That will start to open more positions in certain industries.

[anothertntony]

Originally Posted by LynnHarris

The truth of the matter is no matter if you earn a million dollars a year or twenty thousand dollars a year, the individual applying for the mortgage is the ONE that is responsible for accepting the loan. While I do agree that some banks try to encourage home buyers to select a certain type of mortgage, it is still the customer's responsibility to say "no".

I think that many home buyers during the bubble were making reasonable decisions. Homes were appreciating at mind numbing rates. Given that it is a leveraged asset, there was basically no other asset class that regular people can access that would outperform a home purchase if the prices continued to appreciate.

If things go well, you make literally tens to hundreds of thousands of dollars in a couple years without doing anything. If things go poorly, you walk away from a house in which you have no equity with a seven year black eye on your credit. In that environment, it made sense to buy as big of a house as possible with zero down payment. You don't want any skin in the game at that point because the potential downside is then just poor credit for a while.

To sweeten the pot, the foreclosure process takes 6-12 months, so you live rent/mortgage free for long enough to save some money.

Taking out a mortgage is not a promise. It isn't a "my word is oak" business. It's a contract. The contract states that you either pay off the mortgage or give up the house. The second option is still always an option; the potential for strategic foreclosure made buying at silly prices reasonable. Note that many other forms of debt cannot be discharged, even by bankruptcy (e.g., many student loans).

If the mortgage lenders intended on holding the mortgage, then requiring a 20% down payment is a no-brainer. That down payment encourages the buyer to not walk away because they will then lose that 20% plus any accrued equity. Without the down payment, walking away became the best option. However, the mortgage lenders didn't hold the mortgage. They spun them up into a witches brew flavored by financial jibber jabber and somehow created mortgage backed securities with eBay-like ratings (A++++ would buy again!!!!). One way or another, they managed to collectively dump the risk on taxpayers in general rather than anyone specific (more importantly, rather than anyone involved in all of the insanity). So, the risk was ultimately borne by people not generally benefiting from the risk taking.

It was all stupid, but blaming people who bought houses they could not afford is short-sighted. In a well-functioning system, they would never have been able to buy the houses in the first place because the ultimate lender would recognize the high risk to themselves and the low risk to the borrower.

[RandyWatson13]

We all know Atlanta led the nation in homes during the 2000s so its natural we have higher fallout. Nothing new and completely logical.

I also agree it was a supply side issue, not a demand side. THere is always demand for people that can't buy homes that want homes. The greedy buggers decided to make it the next bubble after the internet bubble and approve everyone.

Also its great to see home prices fall to where they SHOULD be. We all know prices were far inflated. Let them rest naturally and of course those in good locations will rise. Sadly those far out will have a far tougher time recovering.

With an estimated 2 million more people coming here by 2040, the market will rebound.

[lastminutemom]

I am unsure that we are going to see the growth that has long been projected. Only time will tell, but even illegal immigration (and legal immigration) have slowed significantly over the last few years.

I agree with you about prices. I have long been concerned that prices rose way to fast. When our neighborhood went from a community where families could afford a home on one income, to one where it generally took two, I believed that the price increases were not sustainable. The latest statistics on family structure lead me to believe we (not just ATL, but most of the US) are a long way from going back to the artifically high prices of the mid 2000s.