10 (Good) Reasons to Buy a Home in Atlanta this year

1. YOU CAN STILL GET A GOOD DEAL

In many Atlanta neighborhoods, home prices are starting to inch up again, but there are still several communities where prices haven't hit rock bottom.  

If you look into distressed properties (foreclosures, REOs and short sales), they are typically selling at 15% to 25% below fair market value.  Don’t miss the opportunity to get that ‘once-in-a-lifetime’ bargain on your dream home.

2.  HOUSING IS AFFORDABLE AGAIN

Atlanta homes haven’t been this affordable since the 1990s.   Average U.S. mortgage payments have fallen from $1063 to $645 since the real estate market's peak in 2006.

3. SUPPLY IS SHRINKING AND BIDDING WARS ARE ON THE RISE

Throughout 2012, we saw the demand for housing increase, but there were fewer homes on the market.   Savvy real estate investors understand that we've hit the bottom of the market in Atlanta, so more and more traditional home buyers and investors are getting into bidding wars when fairly priced homes are listed in popular Atlanta neighborhoods and suburbs.  

4.  HOME PRICE INCREASES ARE ON THE HORIZON

In communities like Virginia Highland, Morningside, Dunwoody and the City of Decatur, home values are already on the rise.  In neighborhoods like Historic Grant Park, Kirkwood, and East Atlanta, price increases are definitely on the horizon.   On a national level, the Association of REALTORS reports that "Real estate will be a hedge against inflation, with values rising 15 percent cumulatively over the next three years, also meaning there will be fewer upside-down homeowners.  Today is a perfect opportunity for moderate-income renters to become successful homeowners."

5.  RENTAL RATES ARE SKYROCKETING

Historically, rental rates increase by 3.2% annually.  A study issued earlier this year projects that home rental prices will increase by 4% for the next two years. Trulia recently reported that rental prices have dramatically increased y 5.4% this year.

6.  INTEREST RATES ARE AT HISTORIC LOWS (i.e. MORTGAGES ARE CHEAP)

The Federal Reserve has kept mortgage interest rates low in an effort to stimulate the economy. Low rates will help housing (and our economy) recover, but if the economy continues to improve this year, the need for the Feds to keep mortgage rates low will no longer exist.   The Mortgage Bankers Association has projected that the 30-year mortgage interest rate will be 4.4% by the end of 2013. That is an increase of approximately one full percentage point over current rates, which will have a dramatic increase in your monthly mortgage payment.

How would this impact your wallet?   On a $250,000 home, your monthly payment would go up almost $150 with a 4.4% interest rate.  If you waited to purchase a home and interest rates rose to where they were at in 2007 and 2008 (about 6.5%), your monthly payment would increase by about $450 (or $5,400 per year).

7.  SAVE ON TAXES

Home ownership makes a superb tax deduction and our tax rates favor those who own homes. As long as your mortgage balance is less than the price of your home, mortgage interest is fully deductible on your tax return.

You can deduct mortgage interest from your income taxes. You can deduct your real estate taxes. And you will get a tax break on capital gains -- if and -- when you sell.   Sure, you will need to do your math. You will get the income tax break only if you itemize your deductions, and you may be better off taking the standard deduction instead. The tax breaks are more valuable the more you earn and the bigger your mortgage. Nevertheless, many people will find that these breaks mean owning costs them less, often a lot less, than renting.

8.  INVEST IN YOUR FUTURE - Buy Low, Sell High

 We would all agree that, when investing, we want to buy at the lowest price possible and hope to sell at the highest price. Owning a home in Atlanta can build wealth and offer some protection from inflation as long as we follow this simple principle.  Today real estate is selling ‘low’.  It’s time to buy.

9.  LIVE IN A NICER HOME

In Atlanta, it is often difficult to find a good single family home to rent.  With the low home prices and historically low interest rates, you should be able to purchase a much nicer home than what you would find in the rental market.

10.  IT WILL BE ALL YOURS!

No more pet deposits and white walls!   When you own your home, you can let the pets run wild, paint the rooms fluorescent orange, knock down a wall, plant a garden - whatever you want because it is yours.  Pride of ownership is a huge reason why many people yearn to own their homes.

If you have questions about the home buying process or if you would like to get a better understanding of the real estate market in your preferred Atlanta neighborhood(s), call Kerry and the URBANEST Real Estate Group anytime at 404.205.8800.  We're always here to help!