Archive for Housing

AASU Economic Monitor Says Regional Housing May Have Stabilized

Posted in For Buyers, For Professionals, For Sellers, Real Estate with tags , , , , , on June 10, 2008 by Peter Nelsen

Armstrong Atlantic State University Center for Regional Analysis has released its Economic Monitor for the 1st Quarter of 2008.  In it, Dr. Michael Toma acknowledges the challenging economic conditions facing the coastal empire, but offers a few bright spots for the housing sector saying, “it is possible that some of the leading indicators may have ‘found a bottom.'”  He went on to say this about the housing market specifically:

Although residential construction in the Savannah metro area has suffered through a three-quarter recession, the sector may be at the bottom of the cycle. During the first quarter, the number of building permits issued for single family homes increased 3.2 percent from the previous quarter, after the usual seasonal adjustment to the data. On an over-the-year basis, permit issuance appears to have bottomed out in the last quarter of 2007. Other evidence suggests that the inventory of new unsold homes is beginning to back down from cyclical highs. The average value of a new home building permit issued decreased modestly to $157,500, but has been moving within a relatively narrow range for several quarters. (Dr. Michael Toma, AASU Economic Monitor 1st Qtr 2008 )

This is similar to what I have felt about the existing home sales market in our region.  I have said recently that I believe our below $250,000 market has picked up considerably and is somewhat strong. Which I believe will translate into a stronger $250,000 to $350,000 market this Summer and culminate in a Fall market with homes under $500,000 selling well again.  I do think the $500,000 to $1,000,000 market will not return until next Spring however.  Our luxury market continues to be on par as luxury Buyers are less affected by slowing economic factors and should do well right into next year and beyond.  Dr. Toma’s report concluded with a brief wrap-up which I will include here as my conclusion:

In conclusion, the two-quarter decline in the leading index continues to send a clear signal that the economic environment in the Coastal Empire will remain challenging through 2008. While some promising (perhaps fledging?) signs of stabilization are emerging from the regional housing market, the area’s labor market will be hard-pressed to absorb surplus labor in the short run. 

(Dr. Michael Toma, AASU Economic Monitor 1st Qtr 2008 )