Augusta, GA (Columbia) Housing Market (Evans: townhome, buy, closing)

[Looking For a Home]

More comments from a previous referenced post by Red. These comments are more in line with most of the information posted on this thread. Note the lack of any offers is finally getting the attention of the sellers and builders. As the incentive phase fails to produce significant results, the next step is to get the sellers/builders to reduce the price of the home plus offer incentives. Until the price reduction phase starts, buyers are a great risk of paying thousands too much for their new home.

From this point forward, standard offers should include: a price reduction, all closing costs, and additional incentives. Best of Luck!

Market Conditions for Augusta, Georgia

Reported by Clara Outler,REALTOR, MBA, CRS (Impressive Credentials)

The increase in the number of listings and the decline in the number of buyers can be contributed partly to the the rising number of defaults among "subprime" borrowers, those with low credit scores which disqualify one for regular market rates. These defaults are causing lenders and underwriters to get tougher on who can qualify for mortgage loans. To add to that, the vast and constant media coverage portraying the "entire" real estate market in a negative light, has not helped the situation.

It's a GREAT time to be a buyer if you are in the market to purchase a home. With the huge inventory of homes available, the choices are endless. With so much competition to deal with, Sellers are having to be more creative and generous with concessions in order to sell their homes. Sellers are offering to pay more towards the Buyer's closing costs. They are offering to pay the Buyer's first three or four mortgage payments. They are throwing in Plasma televisions, etc. not just to make the deal work, but in order to receive an offer!

Some builders are feeling the heat as well. While most are not willing to reduce the sales price, they are willing to negotiate on things like additional upgrades at no cost (e.g., stainless steel applicanes, lighting packages, premium carpet and padding), higher contributions towards the Buyer's closing costs, adding a privacy fence at N/C, etc. Some builders are delaying the start of new homes, preferring to exhaust their existing inventory first before gearing up production on more until the market shows signs of improvement.

[Looking For a Home]

Augusta (Columbia County) home sellers we welcome your input on this thread.

[Looking For a Home]

More bad news for the overall housing market.

Interesting article in today's WSJ. The article claims that home prices need to drop about 15% over the next few years and rents need to increase 4% over the same period in order to re-establish the historic standard deviation between home prices and the cost of renting a home.

[Looking For a Home]

To be fair to all points of view, here are a couple of quotes from the Augusta Chronicle and Lydia's Blog concerning the Augusta housing market.

Mark Thompson - Augusta State University

He believes employment growth will offset any job losses caused by the area’s housing decline, which he categorized as a ‘correction.’ “The evidence I see is that we didn’t have the rapid price appreciation that other metro areas had,” he said. “We didn’t have the huge boom; subsequently, we’re not going to have the huge bust.”

Roger Tutterow - Mercer University

Though Dr. Tutterow believes “we’re closer to recession than any time in the past,” he is not predicting a recession, either locally or nationally, in 2008. He forecasts tightening in the financial-services industry because of the slumping real estate market. Dr. Tutterow said local home prices are unlikely to rise in 2008. “I think that we’re getting closer to the bottom of the residential real estate correction, but we’re not there yet,” he said.

I agree with both statements.

The market is in decline and going through a correction. A 30% appreciation for this market over the last 3 years is not huge (but significant), so a 10-20% correction would also not be a huge bust.

The second statement is more telling. There will be no price appreciation in 2008 (based on the current inventory, that is almost a sure bet) and the market has yet to find a bottom (that has been discussed numerous times on this thread).

This market is not will drop 30-40%, but it is declining. If buyers do not keep track of the current market trends, they will pay too much. Buyers need to be aggressive and demand a combination of price reductions, incentives, and fully paid closing costs on all offers. The faster this market can find a bottom it will be better for everyone. Good Luck!

[Looking For a Home]

Augusta Real Estate Market:

Market Conditions for Augusta, Georgia
Reported by Caroline Ashe, ABR, CRS, GRI, Vice President, Associate Broker

Updated January 1, 2008.
Current Market Rating: 2 (Scale: 1 is better for Buyers 5 is better for Sellers)



Current Price Trend: 2 (Scale: 1 is declining Prices 5 is increasing prices)


Augusta's real estate market is steady with slower than normal marketing times or days on the market for sellers. The advantage has swung in favor of buyers.

Not much information here, but it does show that everyone agrees that it is a buyers market and prices are falling. (Note the ratings above).

Buyers need to be aggressive!

[Looking For a Home]

Augusta Real Estate Market Conditions:

Sure the market is very S-L-O-W right now, but we want to hear from both the sellers and the limited buyers in the market.

There are numerous FSBO listings in this area from both individuals and builders, please provide input to this thread.

I noticed a significant increase in the number of incentives offered in 08. Buyers stay aggressive. Good Luck

[Looking For a Home]

Augusta Real Estate Market:

Even more inventory:

Building projects started last spring and summer are starting to flood the market: Crawford Creek, Berkely Hills, and numerous other subdivisons are adding to the glut of homes on the market.

If you track the market, you will notice that numerous homes are relisted everyday with lower prices and additional incentives. (Watch out for the old trick of increasing the selling price to cover the cost of increased incentives)

The statement from Clara Outlerreally captures what is happening in the local Augusta market.

"With so much competition to deal with, Sellers are having to be more creative and generous with concessions in order to sell their homes. Sellers are offering to pay more towards the Buyer's closing costs. They are offering to pay the Buyer's first three or four mortgage payments."

"They are throwing in Plasma televisions, etc. not just to make the deal work, but in order to receive an offer!" (Wow! just to get an offer, this is telling).

Buyers must be aggressive: Use a combination of Price Reductions, Incentives, and Fully Paid Closing Costs on all offers. Make multiply offers and be ready to walk away, there is a glut of homes for sale in this market.

[pancho]

We're about to trade up from our current home into something a little better, so I will post my experience once everything is settled. We just made an offer on a nice home in the 3000 sq foot range and also currently have our 1700 sq foot home for sale. We tried to price our home competitively, realizing that we might not break even since we only bought the house two years ago. Both homes are in Columbia County. We don't mind losing a little on this home if it means we're going to walk into a much better home at a bargain price.

[Looking For a Home]

Nov. Housing Index Falls 2.6 Percent

The indicators in the Augusta Housing Market show that we have yet to find a bottom to the current decline.

By ALAN ZIBEL, AP Business Writer
29 MINUTES AGO
WASHINGTON - Pending U.S. home sales dipped in November, a trade group for real estate agents said Tuesday, but it expects the sales pace to pick up significantly in the second half of 2008.
In another indication that the housing market's struggles aren't finished, the National Association of Realtors said its seasonally adjusted index of pending sales for existing homes fell to a reading of 87.6 from an upwardly revised October index of 89.9.
The index, which was down 19.2 percent from a year ago, hit a record low in August at the peak of the worldwide credit squeeze.

Numerous economists, however, are much more pessimistic about the housing market this year and are predicting far lower home sales.

Again, the last statement is very telling, the NAR has been wrong for the past two years. Buyers beware!

[Looking For a Home]

Pancho,

Thanks for your input. Please keep us updated.