Things are moving fast in Washington so I thought I would update my blog from yesterday. The legislation that Senator Isakson proposed for a housing market stimulus has been included in the Senate stimulus (spending) bill as of last night. See article from the AJC

Before I go off on another rant I just wanted to say thank you to Senator Isakson’s staff for being so helpful. I called his Washington D.C. office to get some information straight from the source. I spoke to James Bostic (one of his aides) in Washington and Andrew from his GA office. They were both very polite and responsive.

They both informed me that Senator Isakson has not decided at this point if he will be supporting the stimulus bill that now includes his housing proposal. Frankly I am doubtful that he will oppose the bill now that it includes his baby but one can always hope. Read the rest of this entry »

It appears Georgia Senator Johnny Isakson does not believe in free markets and limited government.  I read few news articles about the housing proposal that he is trying to push into the latest stimulus bill at a cost of $20 billion dollars.  To quote a recent article:

“Specifically, Isakson’s Fix Housing First Homebuyer Tax Credit legislation would also enhance the existing homebuyer tax credit by:

• Extending the eligibility period for the credit to December 31, 2009;
• Increasing the credit amount to 10 percent  of the home price capped at 3.5 percent of FHA loan limits (geographically dependent) – ranging between approximately $10,000 and $22,000;
• “Monetizing” the credit so it is available at time of closing; and
• Allowing the credit to be used in conjunction with mortgages financed by state or local bonds.”

I read the full article and I bet he is right, it would spur some activity in the housing market but at what cost? Not only does it cost $20 billion but what happens to the market as soon as the incentive runs out in 11 months?  I guess sales and prices will slide back again using the same logic he uses to support his ill conceived proposal. Read the rest of this entry »

Many of the people I see ask me how the Alpharetta and Johns Creek real estate market is performing as the new year gets underway.  So, do you want the good news or bad news first? I’d rather give you the bad news first, so we can end on a positive note.

The Bad News

• January 2009 sales are down 50% compared to sales at this point in January 2008
• Homes prices are softer than this time last year (good news if you are a buyer)
• Financial markets are still uncertain which works against large decisions such as home purchases

The Good News

• Interest rates are fantastic!  (it is time to refinance or make a new purchase to take advantage of this temporary situation)
• We are closer to a turn-around than we were a year ago
• Prices for home repairs and services are attractive (shop around and you will be happily surprised)
• The slow market has weeded out many substandard real estate agents, loan officers and closing attorneys
• Spring is just around the corner and now is the perfect time to position your home to sell this year

I tend to focus on the positive. Right now is the time for action. Whether you are a buyer or seller the time for you is now. Read the rest of this entry »

The recently released National Association of Realtors report for September Existing Homes showed sales rose for the first time since July 2003 as compared to a year earlier. Good news right? Not so fast.

Keep in mind that this report reflects homes that actually closed in September 2008 which means that the homes went under contract in July and August. This was before the massive real estate slowdown which hit when the finacial markets went into turmoil in September.

When the reports come out that reflect our current October 2008 real estate market, the headline will most likely read “Largest drop since the records have been kept!” or “45-50% drop shocks the market”. The news media is better than I am in creating sensational headlines but you get the idea. These ugly reports will come in the following order: the October pending sales report due out on November 7th, October new home sales on November 26th and November existing home sales due on December 23rd.

These sales reports will all reflect what you can see in real time on the Alphahomes Sales Trends page. I report pending sales so you get a view of how the market is doing now. I keep the figures regularly updated so check them often to keep up with the real estate market in Alpharetta and Johns Creek, GA. Since it is near the end of October it is safe to say that our sales will show a drop of about 50% over October last year and September of this year. Read the rest of this entry »

These days I am often asked when the housing market will start to improve. Of course being me I have a few opinions. First though we must recognize what got us into this mess before we can understand how to get out.

Quite simply this was caused by a confluence of the following factors:

• Loose loan qualification standards driven primarily by Fannie Mae and Freddie Mac guidelines
• Low interest rates that helped fuel the dramatic rise in home values giving the impression that fantastic profits could be made safely by short term real estate ownership
• Investors and owner occupant home buyers that purchased homes as investments without considering the reality that homes prices don’t always go up
• Lenders that were more than happy to originate loans to anybody that could spell their name correctly two out of three times
• Buyers that were willing to use creative loan programs designed to get them into homes that were really more than they could comfortably afford Read the rest of this entry »