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Atlanta Housing Economic Trends

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					             Atlanta Housing Economic
                      Trends
                                            May 2008




Note: This information is deemed accurate but not guaranteed. It is intended for the personal use of HBA members only.
                                    Market Update
                                             Dick Hearin


                               Are There Any Opportunities?

This residential market recession is not any “equal opportunity” challenge. Not all geographic areas
across the Country have suffered equally, nor have all areas and price points in the Atlanta metro
area. The turn-around will be uneven and some areas and price points will improve sooner than
others.

In a previous column, we recommended you “Examine your submarket, price point and product
competition...”, and determine the market conditions that you face, or that your local “home to sell”
prospect faces. There are many factors to consider, but one measurement – months supply –
balances current listed inventory against sales. It is one indicator that gives us a snapshot of
balance or imbalance in the market.

The table below (next page) gives you our evaluation of the price brackets by MLS area where
current listing inventory has returned to an acceptable level based upon the most recent 12-month
period sales. Note: if you believe we have yet to hit bottom and that sales over the next 12 months
will be lower still, then these figures are overly optimistic. Keep in mind it is important to evaluate
more than one criteria when analyzing a market.
                                               Markets in Balance?
                      Potential for a More Normal Market based upon
 May-08                  Months Supply of Listed Inventory ONLY
                                                                                               Potential for a More Normal Market based upon
               MLS         RESALE SFD                  New SFD             May-08                 Months Supply of Listed Inventory ONLY
 County        Area     < this price range        < this price range
                                                                                      MLS        RESALE SFD                    New SFD
      Cobb       71 <$125,000 & $400.0-450,0          $500,000
                                                                           County     Area     < this price range         < this price range
                 72          None                     $225,000
                                                                                 Hall  261         $125,000                   $225,000
                 73        $100,000                   $275,000
                                                                                       262         $125,000                   $175,000
                 74        $175,000                   $250,000
                                                                                       263     $100,000 - $125,000            $175,000
                 75        $175,000                   $275,000
                                                                                       264         $125,000                   $275,000
                 81        $200,000                   $350,000
                                                                                       265         $150,000                   $225,000
                 82        $350,000                   $450,000
                                                                               Dekalb    51        $275,000                   $400,000
                 83 <$150,000 & $200,0-250,0          $500,000
                                                                                         52    $175,000 - 400,000             $275,000
  Cherokee      111           None                    $200,000                           53          None                     $250,000
                112         $175,000                  $275,000                           41        <$175,000                  $350,000
                113         $175,000                  $225,000                           42          None                       None
                114         $150,000              $200,000 - 250,000                     43          None                       None
   Paulding     191         $125,000                  $175,000                           121       $400,000                   $600,000
                192         $100,000                  $225,000               Rockdale    101          None                    $225,000
North Fulton     21         $500,000                 $1,000,000                          102          None                    $400,000
                 22           None                    $250,000                Newton     151       $100,000                     None
                 23         $225,000                  $500,000                Clayton    161          None                      None
                131           None                    $500,000                  Henry    211       $125,000                   $125,000
                132           None                    $850,000            south Fulton   31           None                   $175,000
                 13         $275,000                  $300,000                           32           None                   $175,000
                 14         $275,000                  $450,000                           33           None               $200,000 - $350,000
    Forsyth     221        $22,500             <$275,000 & $300,0-400,0        Fayette   171       $200,000                   $250,000
                222       $200,000                    $400,000                Coweta     181       $175,000                   $400,000
                223   $125,000 - $200,000             $275,000                Douglas     91       $100,000                   $275,000
   Gwinnett      61 <$125,000 & $200.0-300,0          $275,000
                 62          None                     $175,000
                 63        $125,000                   $225,000
                 64        $125,000                     None
                 65          None                     $175,000
                 66        $125,000                   $175,000
                                                                         60
                                                                         65
                                                                         70
                                                                         75
                                                                         80
                                                                         85
                                                                         90
                                                                         95
                                                                        100
                                                                        105
                                                                        110
                                                                        115
                                                                        120
                                                                        125
                                                                    4Q-94
                                                                    2Q-95
                                                                    4Q-95
                                                                    2Q-96
                                                                    4Q-96
                                                                    2Q-97

                                                                    4Q-97
                                                                    2Q-98
                                                                    4Q-98




                                    Graph Information: As of 1Q08
                                                                    2Q-99

                                                                    4Q-99
                                                                    2Q-00
                                                                    4Q-00
                                                                    2Q-01
                                                                    4Q-01

                                                                    2Q-02
                                                                    4Q-02
                                                                    2Q-03




Source: Roger Tutterow, Economist
                                                                    4Q-03
                                                                    2Q-04
                                                                    4Q-04
                                                                    2Q-05
                                                                    4Q-05
                                                                    2Q-06
                                                                                       Consumer Confidence




                                                                    4Q-06
                                                                    2Q-07
                                                                    4Q-07
                                                                            Atlanta
                                                                            National
90,000
                                Job Growth Trend
80,000

70,000

60,000

50,000

40,000

30,000

20,000

10,000
      b




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                                                                                         A
                         2006                                                       2007                      2008
  Graph Information: As of 4/08
  -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
  -Based off Atlanta MSA (See MSA Definition at end)
                                           Source: AXIOMetrics, Inc. / Bureau of Labor
                                  Atlanta Permits
                                  Single-Family vs. Multi-Family
  65,000
  60,000
  55,000
  50,000
  45,000
  40,000
  35,000
  30,000
  25,000
  20,000
  15,000
  10,000
    5,000
         0




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                                             Mult i-Family Permits               Single Family Permits

Graph Information: As of 4/08
-Updated monthly – Based off Trailing 12 month numbers.
-Based Atlanta MSA (See MSA Definition at end).
                                           Source: AXIOMetrics, Inc. / Census Bureau
          Primary Mortgage Market Survey
 8.00%

 7.00%

 6.00%

 5.00%

 4.00%

 3.00%

 2.00%

 1.00%

 0.00%




        8
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   03




                                                Fed Funds           30 Year          1 Year Arm
Graph Information: As of 5/08
-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 rates is based off the last day of each quarter (Up until 3/07). Then updated monthly.
                                                       Source: FreddieMac.com
Lumber Index

   6.00
                       Atlanta Building Products                                       Concrete
                                                                                        $95

   5.50                                                                                 $93

                                                                                        $91
   5.00
                                                                                        $89
   4.50                                                                                 $87

   4.00                                                                                 $85

   3.50                                                                                 $83

                                                                                        $81
   3.00
                                                                                        $79
   2.50                                                                                 $77

   2.00                                                                                 $75




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                                                        Lumber          Concrete
Graph Information: As of 5/08
-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: STOCK Building Supply and Random Lengths

-Concrete data is based off 3000 PSI, per cubic yard (Use Right Axis)
      -Source: Survey of Purchasing Managers
                                               Metrostudy
                                North Atlanta Starts/Closings
10,000


 9,000


 8,000


 7,000


 6,000


 5,000
                                                                                                                                           -30.7%
                                                                                                                                           3,848
 4,000


 3,000
                                                                                                                                              -55.1%
                                                                                                                                              2,646
 2,000
           3Q03

                  4Q03

                         1Q04

                                 2Q04

                                        3Q04

                                                4Q04

                                                       1Q05

                                                              2Q05

                                                                     3Q05

                                                                            4Q05

                                                                                   1Q06

                                                                                          2Q06

                                                                                                 3Q06

                                                                                                        4Q06

                                                                                                               1Q07

                                                                                                                      2Q07

                                                                                                                             3Q07

                                                                                                                                    4Q07

                                                                                                                                           1Q08
                                               Quarterly Starts                    Quarterly Closings
    Graph Information: As of 1Q08
    -Represents North of I-20
    -Percent change from same quarter 1 year ago
                                               Metrostudy
                          North Atlanta Housing Inventory
30,000                                                                                                                             14.0
                                                                                                                       11.6
                                                                                                                       MOS
                                                                                                                                   12.0
25,000


                                                                                                                                   10.0
20,000

                                                                                                                                   8.0
15,000
                                                                                                                                   6.0

10,000
                                                                                                                                   4.0

 5,000
                                                                                                                                   2.0


   -                                                                                                                               0.0
            1Q04

                   2Q04

                          3Q04

                                 4Q04

                                        1Q05

                                               2Q05

                                                      3Q05

                                                             4Q05

                                                                    1Q06

                                                                           2Q06

                                                                                  3Q06

                                                                                         4Q06

                                                                                                1Q07

                                                                                                       2Q07

                                                                                                              3Q07

                                                                                                                     4Q07

                                                                                                                            1Q08
                   Fin Vacant                                Under Const                                  Housing Mos

   Graph Information: As of 1Q08
   -Represents North of I-20
   -MOS = Months of Supply
                                              Metrostudy
       North Atlanta Vacant Developed Lots Inventory
90,000                                                                                                                             87,649
                                                                                                                                   61.4 MOS
80,000

70,000

60,000

50,000

40,000

30,000                                                                                                                             17,126
                                                                                                                                   -43.1%
20,000

10,000

   -
           1Q04

                  2Q04

                         3Q04

                                4Q04

                                       1Q05

                                              2Q05

                                                     3Q05

                                                            4Q05

                                                                   1Q06

                                                                          2Q06

                                                                                 3Q06

                                                                                        4Q06

                                                                                                1Q07

                                                                                                       2Q07

                                                                                                              3Q07

                                                                                                                     4Q07

                                                                                                                            1Q08
                                   VDL Inv                                                     Annual Starts
  Graph Information: As of 1Q08
  -Represents North of I-20
  -MOS = Months of Supply
  -Percent change over same period one year ago
                                                 Metrostudy
                                 South Atlanta Starts/Closings
7,000

                                                                  2Q06 – Highest Starts in History
6,000



5,000



4,000



3,000
                                                                                                                                     -47.2%
                                                                                                                                     2,035
2,000
                                                                                                                                     -63.6%
                                                                                                                                     1,285
1,000
            1Q04

                   2Q04

                          3Q04

                                  4Q04

                                         1Q05

                                                 2Q05

                                                        3Q05

                                                               4Q05

                                                                      1Q06

                                                                             2Q06

                                                                                    3Q06

                                                                                           4Q06

                                                                                                  1Q07

                                                                                                         2Q07

                                                                                                                3Q07

                                                                                                                       4Q07

                                                                                                                              1Q08
                                                Quarterly Starts                Quarterly Closings

        Graph Information: As of 1Q08
        -Represents South of I-20
        -Percent change over same period one year ago
                                                Metrostudy
                           South Atlanta Housing Inventory                                                                          10.4
18,000                                                                                                                              MOS
                                                                                                                                    10.0
16,000

14,000
                                                                                                                                    8.0
12,000

10,000                                                                                                                              6.0

 8,000

                                                                                                                                    4.0
 6,000

 4,000
                                                                                                                                    2.0
 2,000

   -                                                                                                                                0.0
            1Q04

                    2Q04

                           3Q04

                                  4Q04

                                         1Q05

                                                2Q05

                                                       3Q05

                                                              4Q05

                                                                     1Q06

                                                                            2Q06

                                                                                   3Q06

                                                                                          4Q06

                                                                                                 1Q07

                                                                                                        2Q07

                                                                                                               3Q07

                                                                                                                      4Q07

                                                                                                                             1Q08
                   Fin Vacant                                 Under Const                                 Housing Mos

       Graph Information: As of 1Q08
       -Represents South of I-20
       -MOS = Months of Supply
                                              Metrostudy
       South Atlanta Vacant Developed Lots Inventory
70,000                                                                                                                             60,663
                                                                                                                                   82.4 MOS
60,000


50,000


40,000


30,000


20,000

                                                                                                                                     8,838
10,000                                                                                                                               -56.4%

   -
           1Q04

                  2Q04

                         3Q04

                                4Q04

                                       1Q05

                                              2Q05

                                                     3Q05

                                                            4Q05

                                                                   1Q06

                                                                          2Q06

                                                                                 3Q06

                                                                                        4Q06

                                                                                                1Q07

                                                                                                       2Q07

                                                                                                              3Q07

                                                                                                                     4Q07

                                                                                                                            1Q08
                                   VDL Inv                                                     Annual Starts

       Graph Information: As of 1Q08
       -Represents South of I-20
       -MOS = Months of Supply
       -Percent change over same period one year ago
          Coldwell Banker Builder Developer Services                                     Months
Units                               Single-family Detached                               Supply
7 0,000                                                                                   1 6.0


60,000                                                                                    1 4.0

                                                                                          1 2.0
5 0,000

                                                                                          1 0.0
40,000
                                                                                          8.0
30,000
                                                                                          6.0
20,000
                                                                                          4.0

1 0,000                                                                                   2.0

     0                                                                                    0.0




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                 NEW Home Units A v ailable             RESA LE Home Units A v ailable
                 NEW Home Months Supply                 RESA LE Home Months Supply


Graph Information: As of 4/08
Source – Coldwell Banker Universal Database, Combines FMLS and GaMLS Data
Note: As of 1/08, the above graph again includes FMLS and GaMLS Data.
Based off 15-Counties (Please see definition at end)
Information contained herein deemed accurate but not guaranteed.
        Coldwell Banker Builder Developer Services
                                    Single-family Detached
 Resa l e                                                                    New Hom es
 7 5 ,000                                                                     24,000

 7 0,000
                                                                              22,000
 65 ,000
                                                                              20,000
 60,000

 55 ,000                                                                      1 8,000


 5 0,000                                                                      1 6,000

 45 ,000
                                                                              1 4,000
 40,000
                                                                              1 2,000
 35 ,000

 30,000                                                                       1 0,000

           05  06  06  06  06  06  06  07  07  07  07  07  07  08  08
       1 2/ 02/ 04/ 06/ 08/ 10/ 12/ 02/ 04/ 06/ 08/ 10/ 12/ 02/ 04/


                     RESA LE Home Units Sold           NEW Home Units Sold

Graph Information: As of 4/08
Source – Coldwell Banker Universal Database, Combines FMLS and GaMLS Data
Note: Trailing 12 month sale totals.
Based off 15-Counties (Please see definition at end)
Information contained herein deemed accurate but not guaranteed.
              Upcoming BDL Meetings
  • July 16
      – Economic Forecast Roundtable


  • Aug. 20
      – Market Update with Eugene James and Terry Morris


  • Sept. 17
      – Consumer Confidence with Roger Tutterow




BDL meetings are at 8 a.m. at The Housing Center in Tucker.
                                               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 and Walton counties.

Coldwell Banker 15-county area includes: Fulton, Cobb, Cherokee, Forsyth, Gwinnett, Hall, DeKalb,
Rockdale, Newton, Clayton, Henry, Fayette, Coweta, Douglas and Paulding counties.




       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.
                     Thanks to Our Sources

                                       www.SunTrust.com
                                           Bob Chapin                      www.Metrostudy.com
 www.Atlantahomebuilders.com                Joey Pella                         Phillip Rassel
           David Ellis              Real Estate Finance Group         Vice President, US East Division
Dellis@Atlantahomebuilders.com     Bob.Chapin@SunTrust.com               Prassel@metrostudy.com
         678-775-1403              Joseph.Pella@SunTrust.com                404.370.9001 x102
                                          770-442-2204




     www.Mercer.edu
      Roger Tutterow
        Economist
 Tutterow_rc@mercer.edu                                                www.ColdwellBankerAtlanta.com
                                      www.Freddiemac.com                         Dick Hearin
                                                                            Senior Vice President
                                                                          Builder Developer Services
                                                                   Dick.Hearin@ColdwellBankerAtlanta.com
                         Don Maxey                                              404-705-1709
                  Don.Maxey@StockSupply.com
                        770-492-6991

Note: This information is deemed accurate but not guaranteed. It is intended for the personal use
                                    of HBA members only.

				
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