Great bargains for home buyers

As I conclude my tenure as president of the Greater Atlanta Home Builders Association, I am moved to reflect on the dynamic shifts we have seen in the past 12 months and the opportunities that now lie ahead.

Certainly, no one will ever again argue against the central importance of home construction and sales to the metro Atlanta economy. The economic ripple effect of a 60 percent drop in residential construction has helped push the region’s unemployment rate to 7.5 percent. Five Georgia banks have collapsed under the weight of bad loans this year, with more expected to follow.

Yet even with the diminished rate of construction, the 12,997 new homes built in metro Atlanta over the past year have contributed $2.5 billion in local income and almost 40,000 local jobs, according to Elliot Eisenberg, senior economist for the National Association of Home Builders.

The average price for a new home in metro Atlanta has dropped 10.5 percent from last year. Mortgage interest rates are now as low as 5.19 percent for a 30-year, fixed-rate loan. And an enormous backlog of unsold homes is giving qualified buyers —- many of whom still flourish in our region —- a chance for unprecedented deals in the months ahead.

First-time home buyers will be particularly fortunate in the savings they can realize and the incentives they can negotiate. The $7,500 tax credit for first-time home buyers —- the signature provision of this summer’s historic housing legislation —- continues through June 30.

On Dec. 6, New York Times Your Money columnist Ron Lieber suggested we may be entering a “golden age” for home buyers that we will miss once the market recovers.

“Then, everyone who sat on their down payment savings accounts for a few years too long will kick themselves for not taking advantage of what may turn out to be the buying opportunity of a lifetime for those who can qualify for a mortgage,” Lieber wrote.

First-time buyer Shannon Bradshaw recently invested in a well-located new DeKalb County townhome.

“Rates are extremely low and homes are aggressively priced with seller incentives. Right now is the perfect storm in the market,” Bradshaw said. “If buyers can get past the uncertainty of ‘what if,’ they can see the potential to buy their biggest investment at the right price and finance it with the best possible terms.”

Move-up buyers Jennifer and Ken Weinaug looked at more than 200 houses in their search for a single-family home in Sandy Springs after they sold their townhome. Getting the brick home they wanted with a main-floor bedroom and a two-car garage at the right price was challenging.

“Despite a lot of inventory on the market, we could not find a home that met our criteria until new home prices came down,” Jennifer Weinaug said.

As I look back on the historic challenges and reversals of the past year, I am confident there will be better times ahead. With new government programs in the offing to protect homeowners and stabilize the nation’s financial system, housing will emerge as a stronger, smarter sector of Atlanta’s diverse economy.

And the many satisfied new homeowners who take advantage of the market’s many bargains will realize the fruits of their wisdom for years to come.

> Steve Palmer was president of the Greater Atlanta Home Builders Association in 2008.