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Wednesday, October 16, 2019
   
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Residential Real Estate

$150,000 Price Range Continues to be the Hot Spot in Local Real Estate

With more than 6,000 active listings in the Savannah area, and 1,700 new homes under construction or already built on spec according to area real estate experts, it’s obviously a buyers market.

There has been increased sales activity this summer, aided by the federal first-time home buyers $8,000 incentive program, but that is ending Nov. 30.  Realtors also report that closings are taking from four to six weeks longer.

There were approximately 1,000 new listings per month in 2007 and 2008, “and the story in 2009 proves to be following the same path, plus some, with increase in short sales, foreclosures and REOs,” according to Claudia Armbrister’s real estate column in Realty Trends.

Armbrister, a local Realtor working in Chatham, Bryan and Effingham counties, is reflective of the current generation of realtors who rely heavily on the Internet to build their business. She retired to Coastal Georgia just a year ago, with her husband, after his 31 year career with the Army and raising seven children.

“If sellers want top dollar and to get their home sold in under 60 to120 days, they need to price according to this more cautious market, and have it model home perfect,” she says, also advising sellers to entertain all offers. Buyer are also expecting assistance with closing costs assistance and/or are making offers as much as 15 percent or more below the asking price.

Local realtors are very interested in listings under $150,000, in her opinion, because these are moving, generating income for the Realtor trying to stay afloat in this current economy.

Savannah is following national trends. In its September housing starts report, the U.S. Commerce Department said there was a very modest one-half of 1 percent increase in housing starts, including new homes and apartments, but applications for building permits fell for another month.

Of course, some of the best local economic facts and hard data on what is affecting the real estate market comes from Dr. Michael Toma, Ph.D., director of the Center for Regional Analysis, Department of Economics at AASU.

In his most recent second quarter 2009 report, he states that home construction industry began to show life during the second quarter. “While construction activity usually swings upward during spring, the sector staged something of a recovery, pulling back up to two-thirds of year-ago levels. This represents a gain when considering that construction activity recently stood at one-half its year-ago level. The number of building permits issued for single family homes in the three-county Savannah metro area increased to 303, up from 199 in the previous quarter.

“The average value of a single family home building permit issued declined by 8.4 percent (to $154,000) during the quarter and reflects activity in the first-time buyer market as new homeowners were enticed into the market by substantial federal tax credits. This impetus will wane during the later half of the year as the credit expires,” he states, supporting the contention that much of the sales activity continues to be in the $150,000 home price range.

But Toma does not seem any immediate improvement in the local economy, writing, “…the leading index continues to point toward weak economic conditions during the next several quarters. However, the slowing rate of decline in the forecasting index continues to suggest that the worst of the recession is behind us. The coincident indicators are sending a message that the economy may be entering the initial phase of stabilization prior to recovery, but that the foundation for an immediate recovery is not yet present.”

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