For the hottest neighborhoods when it comes to Atlanta real estate, look no further than the places with the best schools.
Real estate agents, builders and industry analysts said homes in the highest demand in 2011 were in the metro area’s best school districts.
Parents are looking to take advantage of depressed prices to move into better school districts before the excess supply of homes in these areas dries up.
“It used to be call white flight, but now I’d call it educational flight,” said Dan Forsman, CEO of Prudential Georgia Realty. “[Parents] want to put their kids in the best school districts. It’s all about the schools and the kids.”
Real estate agents said North Fulton, East Cobb and South Forsyth were all areas with relatively heavy demand right now, in large part because of the strength of their school systems.
And the data appears to back up the anecdotal view.
Open market sales, excluding foreclosures, were highest in Fulton County in 2011, with 5,324. Atlanta’s core county was followed by neighboring Cobb and Gwinnett counties.
Forsyth County totaled 1,514 open market sales in 2011, but had the second-highest average sales price of any of the 11 metro counties surveyed by Bridge Interactive Group LLC.
In contrast, Clayton County — with its school system’s well-chronicled struggles — posted the the third lowest number of sales with roughly 1,000 and lowest average sales price for homes in the metro region at roughly $66,000 last year.
Many view 2009-2011 as a reset for the broad expectations for Atlanta’s real estate market.
“This is our 1934. This is our baseline year,” said Mason Maynard, referring to the year during the Great Depression that saw a series of sweeping economic and political changes that affected the country for decades to come.
For some sellers, the calculus has swung over the last year from waiting for the market’s rebound to simply escaping the fatigue of the last few years, real estate agents said.
“People are tired of waiting at this point,” said Carrie Faletti, a Realtor with Atlanta Fine Homes Sotheby’s International Realty.
Sellers are willing to get rid of a property at this point, real estate agents said, if they can find a similar bargain when they’re hunting for the replacement home.
But one logjam she notes is that homebuyers are not moving up the price chain when they buy their next home, she said.
“It’s difficult for people to move up,” she said, noting that buyers often simply stay at the same price point, given depressed prices and buyers looking for a good deal.
One motivator for the market, Faletti said, would be corporate relocation.
There were few companies moving in 2009 and 2010, she said, creating another drain on the market of both eager sellers and buyers.
Buyers, real estate agents said, still largely exist in the king of all buyers’ markets.
Agents said buyer bidding wars are largely nonexistent outside of several key Atlanta markets, with many buyers looking to buy foreclosed homes for less than $100,000 per year.
For foreclosed homes, the story varies widely depending on the location.
And when selling foreclosed homes in in-demand neighborhoods, the banks are laying out higher prices and tougher terms.
“They’re playing a little more hardball,” said Becky Vinson, a real estate agent with Realty Associates of Atlanta.
“There’s still deals, just not as many on foreclosures and short sales.”
For now, the sales market inside the city’s core appears to be much healthier than the outlying regions.
“We’re not taking much of a hit intown,” said Ben McKenzie, Realtor with Prudential Georgia Realty, who focuses primarily on intown home sales. “It’s a beauty contest and price war right now.”
But in far-flung suburbs, foreclosure sales are still seeing plummeting prices.
In Gwinnett County, for example, once a high-flying hub of Atlanta’s suburban expansion, foreclosures in 2011 were roughly half those posted in 2010, but prices for those foreclosed homes had dropped over the last two years to roughly half their 2009 values.
One area that will lag the broader housing market’s sales, agents said, are condominiums.
The large projects — concentrated in Midtown, Buckhead and other bustling intown neighborhoods — were a high-profile symbol of the construction that took place during the mid-decade housing boom.
But agents said condo sales will likely take more time to catch single-family home sales.
“There’s a number of developments in Midtown that are looking to close out” their last few units and, McKenzie said, the sellers of those units are not as concerned with price in the current market.
Even amid the sluggish sales figures, across the metro market, new-home builders are expressing signs of cautious optimism.
Chuck Fuhr, division president for Ryland Homes of Atlanta, said he projects to build about 225 homes in 2012, up from 178 in 2010.
Fuhr said his company’s new homes are able to compete with the existing pool of homes because some buyers are determined to buy a new home — whether for warranties or improved energy efficiency — over an existing home. But, he said, builders are being selective, choosing only the most in-demand neighborhoods and lots for new projects.
“Sales are moving in the right direction, as painfully slow as it might be,” McKenzie said. “But it’s tough to project what the definition of the new normal will be.”
See article here in the Atlanta Business Chronicle