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Tourism is UP in Fannin
Greenspan Sees the Bottom
Sellers' Quick Fix
Home Inspectors: Still Not Licensed
Increased lending limits - The Time is NOW!!
Vacation Home Market Not that Bad
Upward Turn for Fannin
Tourist numbers increase
Tourists continue to visit Fannin County in spite of the high prices at the gas pumps, a report from the Fannin County Chamber of Commerce shows.
Chamber president Jan Hackett said a check of the May guest book shows 1,555 signatures compared to 1,525 signatures in May 2007 and 1,386 signatures in May 2006.
Along with the signatures, Hackett said the chamber continues to receive requests for tourists and relocation information in higher numbers than 2007.
“We’ve mailed more than 6,000 tourist brochures so far this year, compared to a little over 3,600 for the same period in 2007,” Hackett said.
Last June, she said nearly 2,500 people signed the chamber guest book, and last July was even better when nearly 4,000 people signed the book.
Most of the people who signed the book so far this year are from Georgia, but visitors from Florida are running a close second, Hackett said.
“Visitors from Georgia and Florida make up about 60 percent of the visitors so far this year, while other guest book signers were from Alabama, North Carolina, South Carolina and Tennessee and many other states,” she said.
Through May, there have been 5,768 people who have signed the guest book this year, compared to 5,465 through May 2007, and 5,082 through May 2006, Hackett said.
Greenspan: Prices to Bottom Out in '09
U.S. home prices are likely to bottom out by early in 2009, former Federal Reserve Chair Alan Greenspan told listeners at a Deutsche Bank economic conference in Singapore last week.
"We are having some liquidation now, it will accelerate, but it will not be until early 2009 that we will get close to having eliminated most of (the excess home inventory)," Greenspan said, according to a transcript of prepared remarks.
Greenspan also said he expects the credit crisis to end next year provided that the world economies maintain growth in the face of "a significant further decline" in U.S. home prices.
What’s next? Once home prices and credit markets stabilize, Greenspan foresees a period of inflation.
Source: Dow Jones International News (05/14/2008)
Simple Fix-Ups Pay Off Big for Sellers
Forget about overhauling the kitchen or redoing the bathroom. The fix-ups that pay off the most are often the simpler and more mundane, says Diane Saatchi, senior vice president at the Corcoran Group in New York.
Her specialty is selling high-end properties in the Hamptons. She recommends that sellers focus their improvements on small exterior changes rather than big-ticket projects inside the home. "Make the outside of the house look really great so that people fall in love between getting out of the car and the front door," Saatchi says.
That includes repainting the trim and adding new hardware, manicuring trees and shrubs, replacing old siding and replacing windows that aren’t energy efficient.
Nationally, returns for all major home-improvement projects are fetching 70 cents on the dollar, according to a Remodeling magazine’s survey of real-estate professionals conducted late last year. That's down from 80 cents in 2004.
Source: The Wall Street Journal, M.P. McQueen (05/15/2008)
Despite our support, Governor Perdue vetoed the Home Inspector Licensing Bill (HB 1217) with the following explanation.
House Bill 1217 provides a regime to license Georgia's home inspectors. I am cognizant and respectful of the fact that the advocates for the legislation chose to use and were approved by the Georgia Occupational Regulation Review Council (GORRC). I have come to believe that GORRC review should be the initial threshold for the creation of a new licensing board. I am also aware that the private sector provides several, voluntary professional organizations to achieve the goals of the legislation. It is my preference that the market - not the State - regulate as many of our industries as possible. Thus, in order to not supplant the good work of the free market with taxpayer funds, I VETO House Bill 1217.
GAR President Van Johnson issued the following response:
"The Georgia Association of REALTORS is disappointed by the Governor's veto of the home inspector licensing bill. We have missed an opportunity to protect consumers making one of the most important purchases of their lives. With builder licensing beginning this July, home inspectors will be the only parties to serve consumers in a residential real estate transaction that will not be subject to state licensing. I am certain we will be supporting home inspector licensing in the future."
Freddie Mac and Fannie Mae Change Lending Policy
We have good news to report on Freddie Mac and Fannie Mae’s declining market policies that have been hurting homebuyers in recent months. A bulletin issued by Freddie Mac on May 2 gives lenders new guidelines on how to deal with borrowers in a declining market. Earlier in March, Fannie amended its declining markets policy and reminded lenders to make their own judgment on local market conditions.
I am especially encouraged by this news because just last week I spoke with representatives from Fannie and Freddie and urged them to make it clear that lenders should not be afraid to counter an initial assessment that a home is in a declining market. The changes by Freddie and earlier made by Fannie will make lending easier to borrowers with good credit.
Under Freddie’s new policy, mortgages with maximum Loan to Value equal to or more than 95 percent are not required to reduce the maximum Loan to Value ratio below 95 percent. First, the mortgage must be used to purchase a home or for a “no cash out” refinance. Second, the mortgage must be secured by a one unit residence. Also, the mortgage application must receive a “accept risk class” approval from Freddie’s automated underwriting software. This is good news for the market.
We hope that these policies will bring stability to the market and new qualified buyers to the table. NAR is pleased to bridge the gap between the mortgage lending community and Fannie and Freddie. We hope buyers can benefit and the spring buying season catches on in many markets around the country. -- Charles McMillan, 2008 President-Elect
We have good news to report on Freddie Mac and Fannie Mae’s declining market policies that have been hurting homebuyers in recent months. A bulletin issued by Freddie Mac on May 2 gives lenders new guidelines on how to deal with borrowers in a declining market. Earlier in March, Fannie amended its declining markets policy and reminded lenders to make their own judgment on local market conditions.
I am especially encouraged by this news because just last week I spoke with representatives from Fannie and Freddie and urged them to make it clear that lenders should not be afraid to counter an initial assessment that a home is in a declining market. The changes by Freddie and earlier made by Fannie will make lending easier to borrowers with good credit.
Under Freddie’s new policy, mortgages with maximum Loan to Value equal to or more than 95 percent are not required to reduce the maximum Loan to Value ratio below 95 percent. First, the mortgage must be used to purchase a home or for a “no cash out” refinance. Second, the mortgage must be secured by a one unit residence. Also, the mortgage application must receive a “accept risk class” approval from Freddie’s automated underwriting software. This is good news for the market.
We hope that these policies will bring stability to the market and new qualified buyers to the table. NAR is pleased to bridge the gap between the mortgage lending community and Fannie and Freddie. We hope buyers can benefit and the spring buying season catches on in many markets around the country. -- Charles McMillan, 2008 President-Elect
Vacation Home Market Not that Bad
Great news for us here in the heart of the second-home market!!
Second-Home Sales Accounted For One-Third of Transactions in 2007
WASHINGTON, March 28, 2008 -
The combined total of vacation- and investment-home sales declined with the overall market in 2007, but still accounted for 33 percent of all existing- and new-home sales, which is close to historic norms, according to the National Association of Realtors..
The market share of homes purchased for investment last year was 21 percent, down from 22 percent in 2006, while another 12 percent were vacation homes, compared with a 14 percent market share in 2006. The total share of second homes declined from 36 percent of transactions in 2006.
NARs annual Investment and Vacation Home Buyers Survey shows vacation-home sales dropped 30.6 percent to 740,000 in 2007 from a record 1.07 million in 2006, while investment-home sales fell 18.1 percent to 1.35 million last year from 1.65 million in 2006. At the same time, primary residence sales declined 10.0 percent to 4.34 million in 2007 from 4.82 million in 2006.
Lawrence Yun, NAR chief economist, said the findings suggest different cycles for each of the sectors over the past two years. Investment-home sales declined sharply in 2006 as speculators disappeared, leaving the market to serious buyers, with the pattern continuing in 2007, he said. Vacation-home sales rose to a new record in 2006 because there was a pent-up demand from buyers who couldnt find a property as a result of tight supplies in preceding years.
The overall sales decline in 2007 resulted from a combination of factors. Certainly, second homes are discretionary purchases and there is a natural tendency to pull back from big-ticket items in periods of uncertainty, Yun said. The other factor is the disruption in the mortgage market, with a significant tightening of credit during the second half of 2007. Some buyers simply adopted a wait-and-see attitude.
Yun said lifestyle factors and strong demographics remain positive for the vacation home market. Investment considerations are secondary for vacation-home buyers, so there is some dormant underlying demand, he said. A peak of population is moving through the prime years for buying recreational property. It is welcoming to see investment sales returning to pre-boom sales activity.
The median price of a vacation home was $195,000 in 2007, down 2.5 percent from $200,000 in 2006. The typical investment property cost $150,000 last year, unchanged from 2006.
Fifty-nine percent of vacation homes purchased in 2007 were detached single-family homes, 29 percent condos, 7 percent townhouses or rowhouses, and 5 percent other. In 2006, single family homes accounted for 67 percent of vacation-home sales, while condos were 21 percent.
There were no significant changes in investment housing types. Sixty-one percent of investment homes purchased in 2007 were detached single-family homes, 20 percent condos, 11 percent townhouses or rowhouses, and 8 percent other. Twenty-eight percent of vacation-home buyers paid cash for their property, as did 35 percent of investment buyers.
Sixty-five percent of vacation home buyers and 71 percent of investment home buyers purchased existing homes, while the remainder purchased new homes.
The typical vacation-home buyer in 2007 was 46 years old, had a median household income of $99,100, and purchased a property that was a median of 287 miles from their primary residence.
In listing the reasons for purchasing a vacation home, 84 percent of buyers wanted to use the home for vacation or as a family retreat; 30 percent to use as a primary residence in the future; 26 percent to diversify investments; 25 percent to rent to others; 16 percent for the tax benefits; 14 percent for use by a family member, friend or relative; and 6 percent because they had extra money to spend.
Last year, 19 percent of vacation homes were purchased in the Northeast, 16 percent in the Midwest, 41 percent in the South and 24 percent in the West. In terms of location, 30 percent of vacation homes were purchased in rural areas, 20 percent in resorts, 20 percent in a suburb and 14 percent in an urban area or central city.
Investment-home buyers last year had a median age of 42, earned an income of $92,900, and bought a home that was relatively close to their primary residence a median distance of 27 miles.
When asked about the most important reasons for their purchase of an investment home, 51 percent said to provide rental income; 39 percent to diversify investments; 21 percent to use for vacations or as a family retreat; 16 percent for use by a family member, friend or relative; 11 percent for tax benefits; 10 percent to use as a primary residence in the future; and 4 percent because they had extra money to spend.
Twenty-three percent of investment properties purchased in 2007 were in the Northeast, 19 percent in the Midwest, 38 percent in the South and 21 percent in the West.
Thirty-nine percent of investment homes were purchased in a suburb and another 20 percent in an urban or central city area, 21 percent in a small town, 15 percent in a rural area, and 5 percent in a resort area.
Vacation-home buyers plan to keep their property for a median of 10 years; 38 percent plan to keep their vacation home for 11 years or more. Investment buyers plan to hold their property for a median of four years, with 29 percent planning to keep for six years or more. However, 10 percent of investment buyers plan to sell in one year or less.
Eight in 10 second-home buyers consider it a good time to invest in real estate, compared with 59 percent of primary residence buyers. Forty-four percent of vacation-home buyers and 57 percent of investment buyers said they were likely to purchase another property within two years.
NARs 2007 Investment and Vacation Home Buyers Survey, conducted in March 2008, includes answers from 1,965 usable responses. The survey controlled for age and income, based on information from the larger 2007 National Association of Realtors. Profile of Home Buyers and Sellers, to limit any biases in the characteristics of respondents.
The 2007 Investment and Vacation Home Buyers Survey can be ordered by calling 800/874-6500, or online at <http://www.realtor.org/newresearch> www.realtor.org/newresearch. The cost is $50 for NAR members and $125 for non-members.
Upward turn predicted for Fannin market
Fannin County’s slumping real estate market should begin taking an upward turn later this year and continue that pattern into 2009, a nationally known real estate expert told members of the Fannin County Chamber of Commerce.
A group of 70 chamber members listened as George Slusser looked at the past and current market factors, predicted upcoming changes, and gave business leaders pointers for making positive changes happen. Slusser is former president and chief operating officer for Coldwell Banker’s commercial division, which is based in New Jersey.
Slusser explained that too much money and inadequate housing inventories in years past put the area housing market into its current condition - which is no money and too much inventory. “But things will turn around - they always do,” Slusser said.
He sees an upturn in the market later this year as inventories of housing units stabilize and prices begin to appreciate.
Slusser says several recent factors have influenced his prediction, including a dramatic increase in Internet traffic by people using the Internet to check out Fannin County and North Georgia, many more buyers reported in town, and pending sales have increased among local real estate companies.
Legislation being considered, including a federal tax credit and state short sale tax legislation, is causing optimism. Both measures would encourage home buying by investors and individuals.
Also, “people are becoming more realistic in their pricing. Buying a property for $85,000 and trying to sell it for $300,000 might not be the thing to do,” he said.
Slusser explained Fannin is well-positioned for a recovery. The county’s natural beauty and limited development areas are big attractions for home buyers. Also, more baby boomers will be retiring this year causing an increase in second home demands, millions of Floridians will be looking to leave that state, and a sprawling metro Atlanta area is expected to see its population jump to six million by 2011. Fannin is bound to capture part of this increase.
Slusser reminded Chamber members that the county’s two largest economic factors are tourism and real estate. To capitalize, “we need to make our tourists happy and customer service experience memorable,” Slusser said. Visitors are looking for a “unique Mayberry” type atmosphere that is friendly, clean, beautiful and safe.
Slusser urged the Blue Ridge and Fannin County communities to cross-promote each other, buy locally, and get involved in the community.
There are no open houses at this time.
