Atlanta Housing Economic Trends October 2011 Note: This information is deemed accurate but not guaranteed. It is intended for the personal use of HBA members only.
Market Update With Smart Numbers Steve Palm The trends for September are some of the most intriguing that have been reported. Closings are up, while prices, listings, and inventories are down a lot. For the 4th consecutive month closings for all single family had a double digit percentage year-to-year increase in September. There were 4,847 closings or an increase of 24.9% over September 2010. This was the 9th year-to-year increase in closings out of the last 10 reporting periods. There were 4,138 closings for single family detached in September. This was an increase of 27.3% over September 2010 and the 3rd consecutive year-to-year percentage increase of 25% or more. There were 709 closings for single family attached in September. This was an increase of 12.4% over September 2010 and 5th consecutive year-to-year increase. However, single family attached closings have a long way to go to get back to the 2005 & 2006 September closings of 1,059 & 1,014. The trend that stands out the most for September is closed prices. The average sale price for all single family in September was $162,491 or 11.1% lower than September 2010. This is a new downturn low, as the last time there was a lower monthly closed price was May 1997. The last time a September was lower was 1996. The average closed price for single family detached in September was $169,146. The last time there was a lower average was May 1997. This average is almost $115,000 below the all time monthly high from June 2007. The September 2011 average closed price for single family attached was $123,648. This average is 11.3% below September 2010 and the 45th year-to-year monthly decline out of the last 48 reporting periods. The September 2011 average would need to increase 64% to get back to the all time monthly average high. With prices being so depressed the consumer is less likely to list their home for sale unless, of course, it is a distressed sale. This can be viewed on the chart below, as listings for all single family in September were the least September amount since 2001. Listings for single family detached were the least for a September since 2000. With closings increasing, combined with less listings, inventory levels just keep dropping. The active inventory for all single family was 34,593 at the end of September 2011. The last time an ending monthly inventory was lower was January 2003, while the last time a September inventory was lower was 2001. With low inventory and higher demand comes lower months-supply of inventory. The months-supply of attached inventory is 8.0 and the months-supply of detached inventory is 7.5. The last time a September months-supply was lower was 2000 (attached) and 2001 (detached). Our last Summit was How Low Can We Go. After September s results, we may still be searching for a bottom.
Atlanta Employment Pace of Employment Growth 40,000 15,000-10,000-35,000-60,000-85,000-110,000-135,000-160,000 Sep-09 Oct-09 Nov-09 Dec-09 Jan-10 Feb-10 Mar-10 Apr-10 May-10 Jun-10 Jul-10 Aug-10 Sep-10 Oct-10 Nov-10 Dec-10 Jan-11 Feb-11 Mar-11 Apr-11 May-11 Jun-11 Jul-11 Aug-11 Sep-11 Graph Information: As of 9/11 -Note: Graph reflects Bureau of Labor Statistics annual revision. In some cases, previous months numbers have been greatly altered to reflect new estimates. -Monthly numbers represent annual change from previous year s month Trailing 12 Months -Based off Atlanta MSA (See MSA Definition at end) Source: Bureau of Labor
40,000 Atlanta Permits Single-Family vs. Multi-Family 35,000 30,000 25,000 20,000 15,000 10,000 5,000 0 Sep-07 Dec-07 Mar-08 Jun-08 Sep-08 Dec-08 Mar-09 Jun-09 Sep-09 Dec-09 Mar-10 Jun-10 Sep-10 Dec-10 Mar-11 Jun-11 Sep-11 Mult i-family Permit s Single Family Permit s Graph Information: As of 9/11 -Updated monthly Based off Trailing 12 month numbers. -Based Atlanta MSA (See MSA Definition at end). Source: Census Bureau
Atlanta Historical Monthly Building Permits 6400 (Single Family Detached) 6000 5600 Jan 2004 Sept 2011 5200 4800 4400 4000 3600 3200 2800 2400 2000 1600 1200 800 400 0 4-Jan 4-Apr 4-Jul 4-Oct 5-Jan 5-Apr 5-Jul 5-Oct 6-Jan 6-Apr 6-Jul 6-Oct 7-Jan 7-Apr 7-Jul 7-Oct 8-Jan 8-Apr 8-Jul 8-Oct 9-Jan 9-Apr 9-Jul 9-Oct 10-Jan 10-Apr 10-Jul 10-Oct 11-Jan 11-Apr 11-Jul
Lumber Index 5.50 5.00 4.50 Atlanta Building Products Concrete $115 $110 $105 4.00 3.50 3.00 2.50 2.00 Jan-06 Apr-06 Jul-06 Oct-06 Jan-07 Apr-07 Jul-07 Oct-07 Jan-08 Apr-08 Jul-08 Oct-08 Lumber Jan-09 Apr-09 Jul-09 Concrete Graph Information: As of 10/11 -Lumber Prices based off an index price of what a lumber package would cost to build a 3,200 sq ft house (Left Axis) See Definitions Page for additional information -Source: Magbee Contractors Supply -Concrete data is based off 3000 PSI, per cubic yard (Use Right Axis) -Source: Survey of Purchasing Managers Oct-09 Jan-10 Apr-10 Jul-10 Oct-10 Jan-11 Apr-11 Jul-11 Oct-11 $100 $95 $90 $85 $80 $75
Primary Mortgage Market Survey 8.00% 7.00% 6.00% 5.00% 4.00% 3.00% 2.00% 1.00% 0.00% Mar-07 Jun-07 Sep-07 Dec-07 Mar-08 Jun-08 Sep-08 Dec-08 Mar-09 Jun-09 Sep-09 Dec-10 Mar-10 Jun-10 Sep-10 Dec-10 Mar-11 Jun-11 Sep-11 Fed Funds 30 Year 1 Year Arm Graph Information: As of 10/11 -Based off Freddie Mac Primary Mortgage Market Survey -30 Year and 1 Year rates are derived from the last week of each quarter (Up until 3/07). Then updated monthly. -Fed Funds rate is based off the last day of each quarter (Up until 3/07). Then updated monthly. Source: FreddieMac.com
3Q11 2Q11 1Q11 4Q10 3Q10 2Q10 1Q10 4Q09 3Q09 2Q09 1Q09 4Q08 3Q08 2Q08 1Q08 4Q07 3Q07 2Q07 1Q07 4Q06 3Q06 2Q06 1Q06 4Q05 3Q05 ATLANTA HOUSING MARKET 16,500 15,000 13,500 12,000 Quarterly Starts and Closings (Move-Ins) Starts up Year over Year by 8%, and up 5% from prior quarter 10,500 9,000 7,500 6,000 4,500 3,000 1,500 - Townhomes & Detached Housing Combined 2,098-20.5% 1,547 +8% Quarterly Starts Quarterly Closings
3Q11 2Q11 1Q11 4Q10 3Q10 2Q10 1Q10 4Q09 3Q09 2Q09 1Q09 4Q08 3Q08 2Q08 1Q08 4Q07 3Q07 2Q07 1Q07 4Q06 3Q06 2Q06 1Q06 4Q05 3Q05 ATLANTA INVENTORY AND MONTHS SUPPLY 40,000 14.0 35,000 30,000 25,000 20,000 15,000 10,000 11.9 mos -------Normal was about 9 months------- 12.0 10.0 8.0 6.0 4.0 5,000 2.0-0.0 Finished Vacant Under Construction Housing MOS Graph Information: As of 3Q11 -Represents all of Metro Atlanta attached and detached housing -MOS = Months of Supply
Coldwell Banker NRT Development Advisors Graph Information: As of 10/11 Based off 6 largest metro counties Information contained herein deemed accurate but not guaranteed.
Coldwell Banker NRT Development Advisors Graph Information: As of 10/11 Based off 6 largest metro counties Information contained herein deemed accurate but not guaranteed.
Definitions Atlanta MSA as defined by the 2000 Census (Updated Dec 2006): Barrow, Bartow, Butts, Carroll, Cherokee, Clayton, Cobb, Coweta, Dawson, DeKalb, Douglas, Fayette, Forsyth, Fulton, Gwinnett, Haralson, Heard, Henry, Jasper, Lamar, Meriwether, Newton, Paulding, Pickens, Pike, Rockdale, Spalding & Walton Counties Coldwell Banker 6-County Area includes: Fulton, Cobb, Cherokee, Forsyth, Gwinnett, & DeKalb Metrostudy currently gathers data from 22 Metro Atlanta Counties shown to the right: Lumber Information: -Index price is calculated from the sum of the following materials: Plate Stock, Stud Material, Floor Joist, Risers, Bands, Floor Deck, Roof Deck, Wall Brace, Ceiling Joist, Rafters and Miscellaneous Materials. -Based off the amount of material it would take to build a 3,200 square foot house in Atlanta at the current time. Purpose was to show consistency by using the same amount of material over a period of time.
2011 BDL Schedule January 19 February 16 March 16 April 20 May 18 June 15 July 20 August 17 September 21 October 19 November 16 December 21 Note: Meetings are held at 8:00 am at the HBA in Tucker
Thanks to Our Sources www.atlantahomebuilders.com David Ellis Dellis@Atlantahomebuilders.com 678-775-1403 www.suntrust.com Courtney Bayer Commercial Real Estate Courtney.Bayer@SunTrust.com 770-442-2214 www.metrostudy.com Eugene James Director, Atlanta Region EJames@metrostudy.com 404.370.9001 x111 www.freddiemac.com Don Maxey dmaxey@magbee.com John Hunt P.O. Box 636 Marietta, GA 30061 Office 770-424-5128 Cell 678-770-4902 NRTDevelopmentAdvisors.com Bob Romano Executive Vice President Office: 404-705-1755 Cell: 678-414-4852 Note: This information is deemed accurate but not guaranteed. It is intended for the personal use of HBA members only.