Naturally this post is the product of real world experiences – two of them within a week of each other, both over 700K and each in distinctly different areas of the great Atlanta market. The question begs to be asked; why in the face of logic does logic seem to be dismissed?

Discussion with other agents about this rendered the expected comments and shared war stories – and two things that many experienced agents have heard but kind of hoped were more rumor than fact. First, despite the devastating real estate crash and demonstrated problems with agent proficiency, the real estate industry has done nothing to raise the performance bar of agents. Clients haven’t either. People like doing business with folks they have relationships with, but is who you know more important than what you know?

Second revolves around agent reputation. Arguably nothing is as critical to success, but does reputation trump everything? There is no shortage of opinions that say yes. The argument is that an agent is better served by having a listing expire than having it perceived to be sold “low”. That an agent can always fall back and tell a seller “I wouldn’t entertain that “low ball” offer; this home just needs the right buyer”. This avoids the social circle whispers like “Suzy sold that house for what”! Suzy then has the ability to blame the buyers, other agent, rates, and inventory…whatever fits the situation. Suzy has an expired listing but avoids possible gossip about her not being able to secure what is considered a “great price”.

But what happens if/when the factual data doesn’t agree with a “Suzy” agent? When reams of current appropriate data to the micro market level are provided for support? When meetings with the listing agent’s appraiser are called for (and declined) to simply discuss their report? When the comparable homes are from a superior micro market, better equipped or otherwise unreliable? When the pile of data inside the same community is dismissed with the waved hand of the agent? What happens is the deal fails, neither party is satisfied, rates rise and the already small pool of available buyers shrinks just a bit more. And the seller is told, “That offer was insulting”.

Is this a case of sour grapes about not getting a deal done? Not really as they buyers found another home rather quickly. Frustrating? Oh Yes. Does this happen in some cases? Apparently, as several agents expressed pretty pointed opinions and plenty of similar tales once the topic was opened. Hopefully situations like this will become rare as the availability of and access to data increases. Hopefully clients will take the time to verify everything they are told and ask questions. At the end of the day buyers and sellers are the ultimate decision makers, not agents.

Typically, sellers say the main reasons for ordering pre-listing appraisals include:

1. To get an accurate list price. Perhaps:

• In real estate, the 80/20 rule is more like 90/10; 10% of the agents do 90% of the work. If 90% of the agents are that ineffective, then a seller seeking credible, impartial advice is understandable. And VERY disappointing that they can’t get it from some agents.
• Potential problem here is that appraisers look at closed sales – they can be slow to consider pockets of rising value.
• Good coordination with an experienced listing agent can work well in this case. It can also work to counter some agent simply telling an owner what they want to hear to get a listing.

2. A pre-listing appraisal will convince buyers that the home is “worth it”. Not really, consider:

• How does the buyer know this is an objective appraisal?
• What is the stated purpose of the appraisal?
• What parameters did the appraiser use when developing the opinion of value?
• How old is the appraisal, have conditions changed since completion?
• Is the appraiser experienced in this market area?

3. A pre-listing appraisal will counter a “low” appraisal. Rarely if ever:

• An appraisal for a mortgage is different than a “regular” appraisal
• Appraisers are required to follow rigid underwriting guidelines, most non-mortgage reports are not completed to underwriting standard
• Every appraiser has their own methods, measuring style, data sources, etc; they will do their own work and develop their own opinion
• Loan types vary as to the corresponding requirements of each report – FHA, VA, USDA, Conventional, Jumbo….
• Lenders will not consider anything from other than the appraiser hired to complete the assignment or an additional appraisal from another approved appraiser on their list. Of course they say “disputes” will be considered, but practically that is to appease regulators only

So what benefit might a pre-listing appraisal provide? I might see two occasions.

A pre-listing appraisal can provide information and an impartial opinion of value to a seller.

• Many agents want listings, a few have been known to tell a seller anything to get a listing. Valuable marketing time is then lost as the overpriced home languishes
• Owners may not like an appraiser’s conclusions but they are may be more likely to accept it from an appraiser than hear it from a listing agent. Appraisers are more connected to the mortgage process.
• Many agents have no idea how to view a home like an appraiser or what parameters an appraiser works under. An appraisal can provide the seller a better, focused look at the current market from the perspective of a buyer and lender.
• Parts of the appraisal like the sketch, plat, etc can be used as exhibits for the listing. An appraiser knows how to measure a home and what constitutes living area, most agents do not. Big surprises surrounding square footage can be avoided.

Having the appraiser as an advocate can be beneficial.

• The appraiser can be a useful sounding board during the listing if needed by the agent or owner. Market updates, pricing adjustments and even help after contract are potential benefits.
• If a pre-listing appraisal is completed, why not have the appraiser involved when the buyer’s appraiser comes through. The appraiser can prepare a package of comps that meet the appropriate underwriting criteria, demonstrate by their presence that this transaction has been professionally handled and address any potential issues “appraiser to appraiser”. This isn’t cutting out an agent; this is ensuring that the appraiser understands the virtues of the home from another appraiser; in a sense, speaking the same language.

Consider hiring an appraiser as a consultant while the home is listed. Use them to check and verify the data that the list agent collects and ensure that job is accurately completed. Hiring an appraiser to complete a pre-listing appraisal can be beneficial if the appraiser’s use is kept in context. Unrealistic sellers, “yes” agents just looking for listings and sellers that harbor an intrinsic distrust for the real estate profession are unlikely to find a benefit. However, an appraiser employed as a consultant during the selling process can provide a significant advantage; it all comes down to how they are utilized.

Is it wise to waive the appraisal contingency as a buyer? The appraisal topic continues to cause agitation among many in the home buying process, but is the answer to eliminate it? Current markets operating in the present environment: appraisals operate with historic data; a conflict right out of the gate. Add a shortage of comps, reduced inventory and a major influence of institutional investors and you could see appraisal issues coming – in fact we called this as a likely problem early last fall.

In this rather tight Atlanta real estate market, some “regular” buyers are electing to waive the appraisal contingency. This is done primarily to present a more streamlined, competitive offer – one that will better compete with cash offers or set them apart in multiple offer situations. But is it wise? In most cases, no. In fact, in almost every case it’s dumb…and not just for obvious reasons. Investors are a different story and a different breed of buyer; they will do it frequently and they understand it is part of their business.

There are situations where waiving the appraisal contingency may be beneficial, but the average buyer isn’t likely to be in one. Cash is king with investors, especially in the current Atlanta real estate market which is front and center on the radar of institutional investors. To offer list or even above list often isn’t enough now, this is a situation where the appraisal contingency is routinely omitted just to be competitive. In fact, it might be accurate to say that investor offers WITH the contingency are rare and few will successful.

“Regular” home buyers are occasionally removing the appraisal contingency to gain an edge in this competitive market. This is typically seen after a call for “highest and best” final offers; something that can happen on first time and first move up priced homes. An agent may recommend raising the price and pulling the contingency to show the seller full commitment. This can backfire however because many in this group will use FHA for mortgages; an appraisal is integral to the process and these buyers often lack the funds to cover a short fall. A smart agent should also know that a low FHA appraisal can actually be used to the buyer’s advantage.

Some buyers of mid to upper priced homes are also removing the appraisal contingency to be more appealing, again this is most common in a competing offer situation. Often these are buyers that have the ability to cover a short fall, have low LTV loans or are cash buyers. In markets with a limited inventory of quality homes, buyers are looking for any possible edge.

“Regular” buyers removing the appraisal contingency must carefully consider the pros and cons. An appraisal below contract price can be effectively used to negotiate a reduction in sale price. Areas like Atlanta have moved to a seller’s market, but sellers may find it easier to renegotiate than move the home back to active status knowing the problem may occur again. FHA buyers may omit the contingency but an appraisal will be required as part of the loan; so in a sense this is just semantics. That FHA appraised value will run with the home for six months so a seller likely to have an FHA buyer will have a decision to make. Most FHA buyers will not have large amounts of disposable income; a low appraisal may terminate the deal and the seller may be open to a price adjustment. Cash buyers are the most likely group to omit the appraisal contingency. Even though not required, waiving it may prevent a chance to reduce price should one be completed that comes in below contract.

If a buyer considers waiving the appraisal contingency, it is strongly recommended that an active appraiser be consulted for an opinion during the due diligence period. This will provide a “peace of mind” to a buyer and an expert opinion of value; real estate agents are not appraisers and history shows that most do not understand the appraisal process. The appraisal contingency is a major protection for a home buyer; it is completed by a completely impartial party with no direct interest in the transaction. Removal of this layer of protection should be carefully considered as emotion could very easily cloud a buyer’s judgment.

photo credit: Pete Prodoehl via photopin cc

Is there a difference between experienced and expertise? Is it unreasonable to assume that a competent, experienced agent (one that earns a living from real estate) can sell a golf course home? An experienced agent will understand how to assess the comparables, what drives value, what detracts from value and probably how to isolate any contributory value from the golf course. An experienced agent will be able to isolate the contributory value of that golf course location.

What expertise is there to working with a first time buyer, FHA buyer or jumbo buyer?  An experienced agent will have a systematic approach to working with buyers, a major part of that will be preapproval with an experienced lender to ensure that the client is properly counseled as to their options. Bringing in specialists in each field to work with a client is what a good agent does. Does this make them an expert or a smart agent?

Is it possible to be a “short sale expert”? No two situations are alike; differences exist with lenders, mortgage size, owners, home value, area trends and mitigating circumstances surrounding each specific short sale. While an agent may have completed previous short sales and gained some experience with the process, is it accurate to use the “expert” term. Wouldn’t that imply comprehensive expertise – including actual negotiation with the lenders which is prohibited in some states?

There are clear areas of expertise under the “real estate” umbrella. No one can argue legal, mortgage, appraisal, inspection and even investment areas are best left to full time experts in each field. Just as we expect a major league pitcher to have a repertoire of pitches, we expect real estate agents to have a repertoire of abilities. A professional full time agent can handle a first time buyer, golf property, work different parts of a metro area and do it well.

Marketing is all about selling the sizzle as much as the steak, the real estate industry certainly knows that field very well. However, real estate agent credibility in the eyes of the public might be raised if more time were spent of extoling the virtues of working with professional full time agents than was spent fabricating designations and topics to be “experts” in. The true experts in the real estate business understand the importance of a trusted network and delegation as needed; they understand that perhaps the most important thing to know is what you don’t know. They sell the steak.

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Public transit within walking distance results in a 42% boost in home value. Neighborhoods near MLB stadiums cost more – especially if the team has a better shot at winning the 2013 World Series. A sex offender living next door to a family renders their home “virtually unmarketable”. Is there really any way to support these types of claims? Common sense has to come into play of course, along with the understanding that location trumps everything when it comes to real estate. Location is a prickly thing – it makes generalizing anything “real estate” very difficult.

Let’s take the National Association of Realtors report titled “The New Real Estate Mantra: Location Near Public Transportation”. To be certain, this is exactly what you expect; a detailed and lengthy analysis of property values close to vs. distant of public transit hubs. There are ample pages of data and explanation along with the requisite number of graphs and charts. However, the study looked at five metro areas – Boston, Chicago, Minneapolis-St Paul, Phoenix and San Francisco. Is it accurate to take the data from this study and apply it broadly with a headline that can lead readers to misinterpret the results? Especially when the study ignores the entire southeast and central United States?

With as many major league baseball teams as there are, everyone in the county probably has some experience with being at and around ball parks. How many of these are in areas that can be considered highly desirable? Well Trulia will answer that question with their post “Take Me Next Door to the Ball Game”. I think this article is generally accurate; obviously cities like San Francisco, Boston and Washington are highly desirable areas. Despite a team that seems to be competitive, areas around Turner Field in Atlanta are considered second to last in expense – something I know to be true as I’ve worked the Atlanta real estate market for almost twenty years. This is an article that intuitively makes sense; the specific data might be open for discussion but the gist of the post is sound.

The AP article “Molester Should Buy Victim’s House So She Can Move, Suit Says” relates a nauseating story. A neighbor molested this family’s daughter, went to prison and returned to live in the home next door that he owns; clearly not a good situation. However, how can the adverse impact on value due to a sex offender next door be determined? It shocks many people to log onto registered sex offender sites and look at where these people are living, there are more than a few out there. Would paired sales analysis be used? How can you conclusively determine that $XXX was lost due specifically to the sex offender?

Caution must be exercised when seeing headlines that scream “Adding Granite in Your Kitchen Adds 15% to Value” or “New Garage Doors Shorten Marketing Time”. Channels like HGTV can be intoxicating with their advice and recommendations, but the fact remains that while generalizations might be fine, it’s misleading to get too specific. The public is a pretty smart group; as long as common sense is maintained when reading how to “Sell Your Home in a Week Using Aroma Therapy” everyone should be alright. In the end, the real estate market determines the value of a home, nothing more.

© denis_pc – Fotolia.com

Almost every part of the country faces this challenge; in metro Atlanta multiples of examples exist. One especially robust neighborhood discussion here is the definition of a part of Marietta, GA known as “East Cobb“.  Marietta, GA is split by I-75; that area east of I-75 is broadly called “East Cobb”; that area west “West Cobb”. However, within these broad definitions lie many smaller, often controversial designators.

Those familiar with metro Atlanta will recognize “East Cobb” as being a rather desirable market area, homes here tend to be older but the locational appeal and high performing schools mandate a premium for housing. The designation “East Cobb” connotes certain expectations in buyers – and that designation usually brings enhanced value and appeal with it. In this case, school districts tend to be the major influence; two of the six Cobb County high schools east of I-75 are almost universally considered “East Cobb”, the others are debated. However, many homes listed for sale in these districts will incorporate “East Cobb” into the descriptions as it’s an attraction.

So what are the common major neighborhood and market area designators? There are many and the list can be subjective even when it may not appear so. Below are obvious ones and even these have variables within.

• Zip Code – many “neighborhoods” have more than one zip, as do schools districts and even planned developments
• School district – which school? ES / MS / HS?
• Postal Designation – many mailing addresses in Atlanta sprawl across counties, schools and zips
• Natural and Man Made Boundaries – rivers, roads, train tracks can all define an area
• Growth Patterns – it’s common for areas on the edge of highly desirable areas to “incorporate” parts of the desirable area name to bolster image. A perfect example in the Atlanta area is the long established, well regarded “Vinings” area of Cobb County. As the surrounding part of Cobb grew during the boom, the “Vinings” designation was used as much as possible – to the point where it became ridiculous.
• Planned Communities – Larger communities (750+ homes) may share different school districts, zips and counties. Different quality and price points within can also be seen.

Like most things real estate, there is not a clear definitive answer to what constitutes a neighborhood. This is however, one of the single most important aspects of the real estate industry as location trumps most everything else. Seller’s asking “What’s my home worth?” might better be served by first asking “what is my competing neighborhood”; something even experienced agents may find challenging to answer from time to time.

© Regisser.com – Fotolia.com

In what other “profession” are relationships considered as important as industry experience? In what other profession can a part time job or even an “opportunity” job be represented as a full time career? In what other profession will clients be seemingly unconcerned with performance but vigorously pursue someone that will discount fees or provide a “rebate”? Despite the catastrophic housing collapse, the “who you know” seems to be every bit as valued as the “what you know” by many involved in real estate transactions.

This is a sales business; a successful agent brings buyers and sellers together. The public expects smooth transactions; if they can be completed in 30 minutes on TV then certainly things should take but a couple of days in the “real world” However, inside every transaction are multiple, small milestones on the critical path to success. If they fail to be met so does the larger objective; and with that come problems. Those tasks are like starting a car and driving to the store; getting there is the objective, everything else is unimportant…until it’s not. An experienced mechanic, like an experienced agent, anticipates and avoids potential issues and keeps things moving.

Many say it’s not good to do business with friends. Discussing money, credit, home values, personal decorating and the like can be awkward. Some clients prefer to maintain privacy and not share everything with friends; some agents are slow to deliverer bad news to people considered friends. Some clients expect a discount from friends that are agents; some agents may wrestle with this and consider the “half a loaf” idea, give in to get business. Client–agent lines may blur, tension develop if things don’t work out as expected; neither party may want to do business but may feel compelled to…the variables are many.

The real estate industry experienced a seismic shift after the boom; it has become much more complex and in a sense, combative. Sellers are often facing a major loss; many bring money to the table. Buyers find mortgage qualification can be incredibly stressful. Agents are finding reduced inventory, appraisal challenges and unprecedented market swings. The changes are continuous, what used to be a static environment is now exceptionally fluid and multilevel; making a successful transaction look boring is no longer easy. What hasn’t changed is the public perception of agents, in large part because it remains an industry with a very low entrance bar and even lower performance bar; pay the dues, complete continuing education and keep the license active. Introducing this environment into a friendship can produce significant stress.

Given that a real estate transaction is a major financial event in anyone’s life, one would expect some thought and research would be given to selecting a real estate agent. Despite the importance of this, data and surveys repeatedly show that the vast majority of clients speak with just one agent. Fewer still actually verify what they are told by the agent in terms of experience and production.  Obviously there’s no hard data to indicate how many friendships have been impacted by real estate transactions gone wrong, but Google the saying “never do business with your friends” and see that there is no shortage of recently added posts.

© James Martin – Fotolia.com

There is no easy fix at this point, but preparation prior to the appraisal may help. The very first thing to do is understand what an appraisal provides; simply put, an appraisal is a tool used by lenders to ensure adequate value exists in the property being collateralized. Appraisers are required to follow strict underwriting guidelines; there is very little wiggle room with regard to report composition. Third party reviews are common, as are automated valuation mode checks; think Zestimates but with much more detail and accuracy.

So how do you challenge a low appraisal? Simple, think and act like an appraiser. That includes understanding how to measure a home, what constitutes living area, positive and negative influences on value…. A few critical things to keep in mind:

• Appraisers do not set the real estate market; they report current trends and establish the most likely market value of a home at a specific time. New data could enter the market the next day and change that opinion.
• Appraisers work for the lender; they do not work for the buyer or seller.
• Appraisers are required to follow underwriting guidelines. These parameters and requirements are given to them, they are expected to be followed or the appraiser does not work.
• Purchase appraisals completed for a lender are intended to ensure adequate value to cover the amount borrowed. The appraisal is not intended to validate sale price.
• Appraisers are disinterested third parties to transactions. There is nothing to be gained by “coming in low”; appraisers are not out to “kill deals”.
• Distressed sales are considered in the overall market analysis. If comparable, they may be considered in the report. Not all distressed sales are in poor condition.
• Finished basements are finished basements – not living area. These add value and utility, that will be accounted for on the report but these areas will not be included the total living area of the home.
• Despite what HGTV says, no improvement returns dollar for dollar.
• Appraisers measure the outside of homes; some use lasers, some tapes, some wheel, some round off…others don’t. No two appraisers will measure a home the same way. There are clearly established parameters that an appraiser is required to follow. Agents, assessors and others do not always hold to these standards. Learn how to measure a home like an appraiser.

Changes to the appraisal business brought on by the real estate crash have resulted in many experienced appraisers leaving the mortgage side of the business. There are appraisers that are marginally adequate; when encountered it is best to be “helpful” with applicable data.

Applicable data means just that. If there is a dispute, think like an appraiser. In the simplest terms, this means providing comparable sales data to support your position:

• Closed sales within six months preferably, but not over a year
• Closed sales within the defined competing area, typically under a mile
• Closed sales that are physically similar to the subject – style, bedroom count, size, age, lot, location
• Closed sales that are a “reasonable alternative purchase” to the subject; the comparables should be functionally equivalent to the subject with similar appeal. If the subject were offered for sale, the comps would be reasonable alternative purchases to it.

Pending comparables might be used to help ascertain current activity; active listings are likely to be dismissed. As reports of stable to increasing values populate the media, sellers are already increasing list prices; appraisers recognize this and little reliability will be assigned to listings.

It’s best to get ahead of any potential problems. Despite being expected to do so, some appraisers may not have access to all available data. There is nothing wrong with an agent providing an appraiser with all potential comparables (see above); this ensures they see everything. It’s also not a bad idea to provide a fact sheet about the subject, again to ensure that all of the positives are noted.

Friction between agents and appraisers is best overcome by finding common ground. The appraiser has no reason to “kill” any sale; they are simply doing what they are expected to do by their client in the same way the agent is working for theirs. At the end of the day, if everyone does their job in a professional manner problems can be successfully overcome.

© Regisser.com – Fotolia.com

Well they are that certain breed of real estate agent who prefers to tell you how spectacular their listings are; not nice, we’re talking spectacular, immaculate, amazing….and perhaps the best one – “to die for”. Really? To die for?

We’re talking about what’s known in the trade as “real estate agent speak”, or “Realtor speak” and how agents spin their listings.

There remains a rousing debate around agent “puffery” and embellishment; is it legal and ethical according to agent conduct standards? Where does subjectivity end and lying begin? Agents and Realtors are expected to abide by a strict ethical standard; yet many listings routinely misrepresent properties, frequently with errors of fact. These same agents and Realtors promote themselves as professionals with a fiduciary duty to be honest, ethical and accurate in their dealings with the public. Is this apparent double standard one of the reasons real estate agents are held in such low public esteem?

So as the spring market opens, home buyers would do very well to keep everything that they read in context.  Puffery and exaggeration are the norm of course, so keep this “cheat sheet” handy as you peruse listings, it will help you decipher the agent babble.

Convenient to airport / train / highway – the house is adjacent to them or under the flight path; you’ll get used to the windows rattling; think of the noise as white noise; many buyers love planes, trains and automobiles

Walk to shopping / restaurants / entertainment – hop your fence into their parking lots; you can charge good money for over flow parking; no DUI concerns for the owner of this home

Occasional views of mountains / water / city – like when the leaves are off; trees are removed; twice a month when the smog blows out; with a telescope; from the roof

Unobstructed water views – until they build next door; since the water is now in your yard; until the next storm when the view will be from the water; as long as you don’t mind the flood insurance premium

Private natural back yard – because it’s a ravine; borders a detention pond; is a garbage dump

Updated – painted…a room…10 years ago; with scratch and dent items; by the husband that took the 2 hour tile class at Home Depot; with outdated material; define updated?

Updated/renovated/remodeled kitchen and baths – see “updated”; new cabinet pulls; replaced a broken appliance; new faucet or shower head

New, like new – not new, usually a few years old

Brand new / just installed – usually less than a year or two old

Pristine, immaculate, to die for – used

Cute, cozy, quaint, comfortable – small and cramped

Eclectic, edgy, rustic – think from bar décor to college dorm

Excellent – OK

Average – poor

Fair – not operational

Waiting for your touch – if you’re a contractor with lots of time and money, or maybe an arsonist

Handyman Special – money pit, don’t even think about it unless you have money, time and skills

Cash only – should be obvious

And this list merely scratches the surface…

Inaccurate and misleading information does no one any good. The seller is likely to wait longer for a buyer as those visiting are expecting something different. The agent is likely to see an extended market time for the very same reason. The buyer and the buyer agent will be wasting time expecting to see the home described only to find something less. In short, no matter how much someone makes a Hyundai sound like a Ferrari on line, when you walk up to it it’s still a Hyundai. Buyers won’t be fooled, and even if they miss something, inspectors and appraisers probably won’t.

“Agent Speak” and what real estate agents say matters. Nonsense is completely counterproductive but won’t likely stop anytime soon. In fact, it will almost certainly increase as the spring market begins. Agents should take a second to consider the consequences of this; not only to their seller and other agents but to their reputation in their market. It’s fine to shine an apple with worm holes or bruises but keep in mind that in the end, accurately portraying a home often results in buyers with the most realistic expectations…and that usually results in a better experience for the seller.

Atlanta: No longer a buyer’s market © novikat – Fotolia.com

Having cleaned out areas like Phoenix, mega investor groups are now focused on Atlanta, Tampa and other southern cities. What’s driving this interest? What else but potential profit. Economists at Goldman Sacs compare treasury notes at 2% with calculated yields averaging more than 6% nationwide on rental properties. In Phoenix, prices were up 24% from 11/11 to 11/12 versus 7.4% for the nation. That of course needs to be kept in context, but the influence of bulk purchases by investment groups is indisputable when it comes to the data. Inventory and time on market is down, while prices are up, and not just for distressed homes.

So what’s the bottom line for distressed properties in Atlanta? Or more broadly, homes under 200K? Simple, it is now a seller’s market and the idea that bargains are to be had should be dismissed. Considering a balanced market to have a 6+- month supply of homes, the greater Atlanta real estate market shows the following levels as of Dec:

• Under 100K – 1.7 months
• 100K-200K – 2.7 months
• 200K-300K – 4.5 months

The metro Atlanta market as a whole saw supply drop about 41% across all price points from Dec ’11 through Dec ’12. From 0-$500K it’s a seller’s market; 500K+ remains a buyer’s market but supply has been cut in about half as the pendulum swings. Data for the micro markets in the greater Atlanta real estate market vary, but trends are positive overall.

Even more startling are the prices being paid for homes over the last quarter of the year. At or over list price transactions are being seen in surprisingly high percentages. This is not exclusive to distressed homes:

• Under 100K – 31%+- of distressed sales and 8+-% of non-distressed sales were at or over list
• 100K-200K – 12%+- of distressed sales and 10+-% of non-distressed sales were at or over list
• 200K–300K – 4%+- of distressed sales and 9% of non-distressed sales were at or over list
• Of all 4^th Qtr ’12 sales, 13.5%+- of distressed sales and 9%+- of non-distressed sales were at or over list

So the Atlanta home buyer is chasing fewer properties, facing more completion and paying higher prices. They’re also seeing the time to chase these properties dwindle; homes are selling quickly, and so those not fully prepared to buy are never really in the game. Consider median days on market for 4^th Qtr ‘12

• Under 100K – 56 days
• 100K-200K – 75 days
• 200K-300K – 91 days

The data is clear, home buyers in Atlanta under 200K are working in a seller’s market. The influence of large investors is clear; expect more competition, higher prices and a much shorter window in which to make decisions. Multiple offers and calls for “highest and best” are routine, as investor activity has tripled in Atlanta over the last year. These investors have a huge appetite and the hoarding of Atlanta homes for sale under 150K will continue until they move on to the next city or the flavor of the week changes from real estate to something else. When that happens and these same homes are cut loose, we’ll likely see the cycle begin all over again.