I am interested in buying a townhome in alpharetta or johns creek. Recently I saw a couple of new home

Asked by Th-ga2009, Alpharetta, GA Tue Jan 13, 2009

builders gave out 10~15% incentives. How is the trend for existing townhomes in this area? Thanks.

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Deryk Harper, Agent, Alpharetta, GA
Tue Feb 24, 2009
Our January reports just came out and only 300 single family attached homes sold in January for all of metro Atlanta. That's a 37.6% decline from Jan 2008 and the 12th monthly year-to-year decline of 25% or more in the last 17 months according to the report. The average sale price was $155,936 in Jan 09...$25,000 less than Jan 08 and $46,000 less than all time high. Now these are only homes that were actually listed in this system and not courthouse step foreclosures or for sale by owners that may have sold but it continues to support the downward trend in value and sales.

Bottom line...you can get some incredible deals on condos and townhomes but don't expect them to increase substantially in value anytime soon and the will never have the same level of appreciation as a single family home in this area. Buying one of these homes is a lifestyle choice more than an investment choice for most.

Watch out for builder incentives and prices that seem to good to be true. If you are considering buying new hire an agent with a good track record in the area you are considering. Make sure the builder has the majority of the complex complete, amenities too. Now is not the time to be one of the first homeowners in a new complex. There is too much risk that the builder will fail and leave the complex uncompleted....and you without most of your warranties, few neighbors, vacant lots and nowhere to turn. There are still great values out there...just do your due diligence before making your decision...and use a knowledgable, skilled agent to represent and guide you.
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Lorie Gould, Agent, Duluth, GA
Wed Jan 14, 2009
Deryk and Hank are right on. Townhomes and condos have depreciated faster and deeper than single family properties. However, the market at this time is oversatuated with all of the above which explains why we have witnessed many great builders lose their businesses, new homes both single family and attached go into foreclosure. We are in a market not witnessed since reporting began. This is truly the best market on record for buyers to buy in and couple that with the unbelievable interest rates... everyone and anyone who can buy should buy!

Why are builders of single family and attached homes negotiating so much and/ or offering such great incentives? Why are homesellers losing money on homes they are selling? They are doing this because they have to if they want to sell. It is very hard to find a home with instant equity because homes are selling for what they are worth which is much lower than 2005, 2006, 2007, and even 2008 because we are in a market of decline. So you are getting 10%, 15%, and 20% off because that is what the home is worth in todays market. I have seen consumers look at what a house sold for in 2005 and think they are getting instant equity because it is selling for so much less today... and that is just not true. It is selling today for what it is worth today.

Hanks answer was fabulous because you need to think about your goal and plans for the future. We are know longer in the days of buying a home today and making $50,000 in two years. Real estate has always been a great long term investment. Many were very fortunate to buy and sell, buy and sell, buy and sell during some uneblievable years where real estate showed short term returns that were large returns. Those days are gone. And I do believe that it will be many many years before that bubble comes back around.

So look at your goals. I would strongly advise that you hire (which cost you nothing) an experienced Realtor to assist you so that you do not get burned. You need a Realtor that will dig and get the trends for each neighborhood. That can communicate its history etc etc. And you need a loan consultant that puts your best interest at heart.
Web Reference:  http://www.HomesByLorie.com
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Hank Miller, Agent, Alpharetta, GA
Wed Jan 14, 2009
OK, I'll rain of the parade and expand a bit on what Derek said -

I think everyone breathing can agree that "now is a great time to buy" - provided that you can actually afford to own a home, understand the requirements, have reasonable expectations of the future value, understand the process and assume personal responsibility for the decision to buy. Not everyone should own a home...even "when it's a great time to buy". Most owners are in trouble because of stupidity - they overextended, overleveraged and overspent. Of the thousands of foreclosure appraisals and deal I've negotiated just a handful of folks were there because of unexpected circumstances.

Now, unless you are completely read in on trends with condos/townhomes I would avoid attached homes as much as possible right now. Derek is right and I'll expand on his comments. In addition to being a broker, I’ve been appraising here in the metro area since ’93 and had one of the larger appraisal firms on the north side. The condo craze started here when the Olympics came to town – Atlanta was branded as a 24 hour international city…it was going to rival NYC, Boston, Chicago, San Fran…..so builders went crazy with condos in the city and on up the 400 corridor. Some 10+ years later Atlanta is instead home to arguably the highest attached home vacancy/foreclosure rate in the country, and this is at all price points from the city to the ‘burbs. My appraisers feasted on this inventory and I’ve continued to appraise/review even “luxury” units in buildings where construction has halted. The attached home/condo market is as solid as pudding.

Now – to the area that you mentioned. Of course builders are offering incentives, what choice do they have? Think about the sheer number of units sitting empty; both new and foreclosed. Add to that the number of owner occupied units with sellers just looking for anyone to get them out, even at a loss. Sure, you’ll get a great buy getting in but what happens when you want to sell? Getting in is easy – getting out is like leaving the Mafia.

The bottom line is that developers completely disregarded the economic indicators and continued to build. Part of the issue is that once money and permits are granted, they have a limited time to work or risk going through the process again – with no guarantee of success. In a sense, once the process starts it’s almost always going to finish regardless of the market. We now see the results of all of that.

Anyway – I would encourage you to backward plan; if you buy what’s the exit strategy? I tell my clients that under the best of circumstances breaking even constitutes success with attached homes. You’re looking in a great area but keep in mind that when we appraise units here we’re still taking up to 10% annual depreciation and adjusting dollar for dollar for seller concessions. Those 10% - 15% builder incentives are hollow given that many are still holding to 30%+- profit. Despite the sniveling, many builders are content holding as long as they can. I know several, have negotiated with several and have many agent friends that work with them. Are we at the bottom? Probably close but the bottom will be flat and I expect we’ll be well into this year before we start to very slowly pull out.

So, yes it’s a good time to buy but only after tearing apart the data and making certain that you have a pragmatic and somewhat grounded team (like us!) to advise you. Historically low rates and historically high inventory are green lights but only if you cut through the nonsense and get to the number crunching – remove the emotion and focus on the numbers. Drop me an email if you have specific questions – hang in there

Hank Miller, SRA, ABR
Associate Broker & Certified Appraiser
Prudential GA Realty
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Mandy Becker, Agent, Cumming, GA
Tue Jan 13, 2009
The market is on your side right now and there are plenty of very nice townhomes for sale in your area. Builder's have to offer these incentives just to keep up and be competitive with existing inventory. When you use a buyer's agent (which is of no cost to you) even better incentives (and prices) can be negotiated for you. I'm available to help you at your earliest convenience and can be reached at mandybecker@hotmail.com. Visit my website at http://www.CallMandyBecker.com
Best Regards,
Mandy Becker
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Judy Wittenb…, Agent, Suwanee, GA
Tue Jan 13, 2009
Now is the time to buy as there are incredible deals... new construction and resales. You would be amazed at the prices that I am seeing on townhouses due to the number of them out there. There are some really nice townhouses in Johns Creek as well as the Alpharetta and I know they have owners who would love for you to see them.

Judy Wittenberg
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Russ Garmon, Other Pro, Norcross, GA
Tue Jan 13, 2009
Great time to buy, I have seen an increase in sales the last few weeks, I have been booked lately having to inspect properties on the weekends to stay caught up, hope it keeps up.
In your home buying process you will need an inspection.
Check out my web site for more information.
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Deryk Harper, Agent, Alpharetta, GA
Tue Jan 13, 2009
The metro Atlanta market as a whole actually sold less townhomes, condos and other single family "attached" homes in December than any other month I can remember. The total when the reports came out was less than 500. That may have adjusted up some due to the lag time for reported sales. Bottom line is it's a great time to buy if you are in the market. I have seen prices drop drastically on resales in communties where we sold new construction in 2005-06. There are also some foreclosures available that are practically brand new and priced to sell. Shoot us an email at info@keylocationsforyou.com and we'd be happy to help you locate some. We live right off Windward Parkway and we're very familiar with the new construction and resale townhome market in this area.
Web Reference:  http://www.keyhomefinder.com
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