Home prices fall 25% in past year

The median price for an existing single-family home in metro Atlanta fell 25 percent during the past year, weighed down by a tide of foreclosures and other distress sales, the National Association of Realtors says.

The metro Atlanta median price was $115,600 in the first quarter of 2009, down from $154,000 in the same period in 2008, according to figures released Tuesday by the Realtors association. While prices have taken a tumble, sales volume was down 6 percent from a year before.

Enlarge this image

KENT D. JOHNSON / kdjohnson@AJC.COM

Realtors say prices of homes in good condition in regular sales have not dropped as far as the median price.

Single-family home

$115,600: Median home price in metro Atlanta in the first quarter, 2009

$154,000: Median home price in metro Atlanta in the first quarter, 2008

$169,000: The national median price for existing single-family homes in the first quarter, 2009

The decline does not mean the roof has caved in on Atlanta real estate, said Steven Fischer, president of the Georgia Association of Realtors.

“That 25 percent is taking into consideration all of the reductions in values of the sales we’ve had due to foreclosures and short sales,” he said. “It is a true stat, but it doesn’t mean as much to the people who are selling their homes that are not foreclosures or short sales.”

The Realtors association said a two-level market has emerged — one for homes sold conventionally and a second for distress sales. That skews the median downward.

“Traditional homes in good condition have held their value much better, so owners shouldn’t be overly concerned about median prices,” national association president Charles McMillan said.

Nationally, 88 percent of metro areas reported lower median prices for existing single-family homes in comparison with the first quarter of 2008, while 18 areas had price gains.

Deeply discounted sales — including foreclosures and short sales, in which lenders accept less than full payoff — accounted for nearly half of transactions in the first quarter, the association reported. First-time buyers lured by bargains also accounted for about half of purchases.

The national median existing single-family price was $169,000, 13.8 percent less than the first quarter of 2008.  

The median price means half sold for more and half sold for less. But distressed homes are selling for 20 percent less than traditional homes, according to the association.

Metro Atlanta was not among the best or the worst in sale-price changes over the past year.

The steepest decreases were in metro Akron, Ohio, 48 percent; Saginaw, Mich., 54 percent; and Fort Myers, Fla., 59 percent. The largest increase, 21 percent, was reported in the Cumberland, Md., metro area.

In metro Atlanta, Fischer said sale prices will bounce back when the foreclosures and short sales slow down and home sellers no longer have to compete with such low prices.

“If you look at the resale properties that are not foreclosures or short sales, the median home sale price has not dropped near 25 percent,” he said.