The AJC recently noted this trend, itâ€™s been ongoing now for well over a year:
Metro Atlantaâ€™s depressed home prices are drawing the interest of a new type of buyer â€“ companies that buy houses in volume. Such companies have snapped up foreclosures and short sales in the last few months from Gwinnett to Clayton counties, as well homes listed conventionally by realtors. And they say they plan to spend hundreds of millions on homes in the next two years. Most are renting the homes â€“ sometimes to the former owners. Others are buying and waiting for prices to increase before re-selling the houses.
Itâ€™s a new twist on house-flipping, which usually involves a single entrepreneur. The company purchases have helped push up metro Atlantaâ€™s battered home prices, sopped up foreclosures that depress prices and sales, and created jobs at companies that buy, renovate, maintain and manage the houses. The downsides are an uptick in prices and competition for home buyers, along with concern that large-scale absentee owners will not take good care of homes. â€œSome are acquiring houses from foreclosure and leaving them vacant for a purely speculative investment,â€ said John Oâ€™Callahan, the president of Atlanta Neighborhood Development Partnership.
Investors backing the companies range from hedge funds to real estate investment trusts and wealthy individuals. The competition is helping boost prices, which have been rebounding with a more stable market since late winter. The average foreclosure sale price in metro Atlanta rose between January and June by more than 9 percent from a median of $91,657 to $100,220, according to real-estate and data firm RealtyTrac. The median sale price for all homes in the region was $145,000 in August, up more than 16 percent from $124,500 in August 2011. Local observers say most homes bought by investors cost less than $200,000. The effect of investors stepping in the last few months has been noticed by shoppers and real-estate agents, who have seen prices rise with interest from multiple bidders.
The Federal Housing Finance Agency is also in the mix. They had 541 properties in the Atlanta market as well as groups of others in Florida, Arizona, California and Nevada. Housingwire reports that the FHFA did very well in the pilot program. Many are saying it may be rolled out to a much greater extent nationally. Early reports say the pilot went well, except for the one group of properties in Atlanta that did not move. Might be a second course of bloated whale for the sharks.
Associate Broker & Certified Appraiser
Atlanta Communities Real Estate