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David Ellis, Executive Vice President for the Greater Atlanta Home Builders Association, joins hosts Todd Schnick and Carol Morgan on this week’s edition of the All about Real Estate edition for the Atlanta Real Estate Forum radio show. David Ellis discussed the HBA, where the Atlanta housing market currently stands and its future outlook.
Ellis clarified that the Atlanta housing market is getting better and is on the right road to recovery from its downturn. Atlanta is currently the third largest new home construction market in the U.S. and is seeing growth every year. In just a year, the market has seen growth of about 20% and has created 80,000 new jobs. Ellis has learned to be cautious, but states the numbers are looking good.
One of the ways the industry is bouncing back is through the HBA. Ellis says membership is growing, meetings have good attendance and sponsorships are up. One of the new initiatives the HBA has implemented is Elevate, which is targeted at professionals under the age of 40. It’s had many successful events so far and is a great opportunity for young professionals to network and improve their business.
However, some issues still persist throughout the industry. The labor market remains weak, which makes it difficult for companies to actually build their homes. After the collapse of the housing market, many people left the labor industry to find more stable jobs. Now that the market is rising again, it’s hard to convince those people to return to their old jobs. It’s also hard to attract the next generation to these jobs because of the outdoor, physical work. Ellis says it will take a while, but he believes people will see the good income opportunities and strengthen the labor market.
Another problem is the credit issues. After the economic downturn, banks faced new regulations, which pushed many state and community banks away from real estate lending. The smaller local homebuilders relied on these banks to fund their work, so the market is held back because they can’t finance their construction like the bigger companies can.
Atlanta is far from returning to building 60,000 new homes a year like they did in 2006, which happened to be the most homes ever built in one housing market. However, Atlanta has taken a big step up from the 4,000 new homes built in 2009, a 93% decrease over just three years. This year, somewhere between 17,000 and 18,000 new homes were built, which is closer to the 25,000 to 30,000 new homes for a healthy market.
As Atlanta continues to grow, more people will need more places to live. The market remains very diverse and can find something for everybody. The apartment market remains healthy, condos are gaining popularity and town houses are making a comeback. Compared nationally, Atlanta is found to be a very affordable market to buy in. As Ellis says, it will take some time, but all signs seem to be pointing in a positive direction for the housing industry.
Visit www.atlantahomebuilders.com to learn how to get involved or call 770-938-9900.
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