Metro Atlanta foreclosure notices are at their lowest level since the middle of 2007, another sign of an improving local housing market.
This month, 4,531 foreclosures were advertised for March sale at auction across 13 metro counties. At the height of the foreclosure crisis, in 2010, there were as many as 13,834 foreclosure notices in a single month.
The latest number, while still historically high, continues the trend of recent months and means the market is less skewed by a glut of low-priced foreclosures.
“It’s been going down for a long time now,” said Barry Bramlett, president and CEO of Equity Depot, which tracks monthly notices. “Property values are going to start ticking up again. They have to.”
It will be some time before property values rise to the point that many homeowners are no longer underwater, however. Hard-hit areas south of the city, like Clayton and Henry counties, have an especially long way to go.
But the number of monthly notices has not been this low since June 2007, when 4,208 foreclosures were advertised. Meanwhile the median sale price in metro Atlanta rose 38 percent, to $165,000, between the end of 2011 and December 2012, according to data from the Atlanta Board of Realtors. Sales of bank-owned homes fell to 26 percent of all home sales in December 2012, from 47 percent in December 2011.
“It’s a stronger market that is no longer pulling prices down,” said Nancy See, president of the Atlanta Board of Realtors. “We have pent-up demand and low inventory.”
When foreclosures are lower, property values are more likely to rise. An overabundance of distressed properties means the supply of houses on the market is greater than the demand, pushing prices down.
As fewer foreclosures are added, bargain hunters are less likely to find inexpensive houses. People in the market for a new home have fewer low-price options, and those selling homes are competing with fewer distress sales. That shifts buyers from foreclosed homes to regular sales, said Eugene James, the director of Metrostudy.
“It’s simple supply and demand,” James said. “The less there is of something, the more upward pressure it puts on price. All the ingredients are there to see prices start to go up.”
Nationally, home prices rose 10 percent from the fourth quarter of 2012 from the end of 2011, to $178,900, according to the National Association of Realtors. The organization said existing-home sales in the South are 13.2 percent above the fourth quarter of 2011.
The intown Atlanta home market has been robust for the past several months, said Julie Sadlier, a Realtor with RE/MAX Metro Atlanta Cityside. Sadlier said she has begun to see multiple offers on homes for the first time in several years, and that people are selling because they want to, not because they have to.
Still, she said, there are areas that are still struggling — and will continue to do so.
“Outside 285, it’s still real tough out there,” she said.
Gwinnett County, which has led metro Atlanta in foreclosures, had the highest number in February, as well — 913 foreclosure notices. But Clayton and Henry counties have a higher number of foreclosure notices relative to their populations.
Foreclosure notices do not mean that a home or building is necessarily sold at auction. Lenders can reach deals with homeowners, or otherwise make moves to avert foreclosure.
There are still concerns that banks may be holding back some properties to foreclose on in the future, said Brooks Campbell, a branch manager at FirstBank. But as time passes, that fear wanes. In many areas, homes are selling more quickly.
Bramlett said it may be some time before the numbers are as low as they once were, but they are finally reaching pre-mortgage crisis levels.
“It can only improve things for the average Joe Blow,” he said.
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