Climbing numbers — Cobb seeing more family residential housing permits issued
by Sheri Kell
business@mdjonline.com
March 13, 2013 12:00 AM | 2839 views | 3 3 comments | 10 10 recommendations | email to a friend | print

Construction of a house is underway at the Parke Place subdivision in Acworth. Don Sabbarese, director of the Econometric Center at Kennesaw State University, says that even though home prices remain well below 2006 levels, they are finally moving in the right direction. <br>Staff/Emily Barnes
Construction of a house is underway at the Parke Place subdivision in Acworth. Don Sabbarese, director of the Econometric Center at Kennesaw State University, says that even though home prices remain well below 2006 levels, they are finally moving in the right direction.
Staff/Emily Barnes
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Cobb is seeing some significant gains in the numbers of single-family residential housing permits early in the new year.

For January and February combined, there was a 63 percent rise in permits throughout the county, compared to the same-month numbers of 2012.

Carey Cox, senior loan officer at Marietta-based Mortgage South Lenders, says he continues to see a very positive sales market in Cobb County, especially in new construction.

“The first quarter of 2013, traditionally slower, is strong for new construction and will be a continuing trend as the flow of money for construction loans has increased,” he said. “Banks and lenders now have much more reasonable qualification terms for developers and the end user — the buyers — on their home loans.”

Cox said this factor, combined with very low interest rates and well-priced new homes, have fueled new home starts.

In February alone, in Cobb and the six cities, 136 permits were issued, representing an 88 percent increase from the 72 issued in the same month of last year.

In unincorporated Cobb, 80 permits were issued in February. Of the cities, Smyrna, as usual, led with 27 permits issued. Acworth saw 15 new permits issued, and Marietta and Powder Springs had seven each. Both Austell and Kennesaw reported none.

Joe Kerley, owner of Kerley Family Homes, pulled all of the permits in Acworth where his company has been building in several neighborhoods during the last year.

“We’ve been selling an average of 25 homes per month,” he said. “We have a strong presence in Cobb County; however, we have found that Acworth has a lot to offer its residents.”

While some developers and home builders are still finding bank loan qualifications prohibitive, Kerley said a proven record has aided his company’s success.

“I would imagine a new builder would struggle in receiving financing and market share,” he said. “We’ve been able to grow our financial partners, which have allowed us to continue to purchase subdivisions and build homes.”

Kerley said his company also has recently purchased the Summer Village subdivision in Marietta that has just begun construction; and the company is slated to have 30 active subdivisions in the metro Atlanta market by April.

Cox says he expects interest rates to remain low for buyers throughout 2013, and he expects sales to increase in the second and third quarters, traditionally the peak purchasing months for home buyers.

“A strong first quarter is a very encouraging sign for 2013,” Cox said.

Don Sabbarese, director of the Econometric Center at Kennesaw State University, said there are still a lot of “cross currents” in metro Atlanta housing markets.

“A large supply of underwater homeowners remains in the market, which means many are holding on to their homes and unable to sell their existing homes or buy a new home,” he said. “The overall lower inventories have created an upward swing, especially inside I-285 and some of the suburban areas.”

He added that even though home prices remain well below 2006 levels, they are finally moving in the right direction.

“The supply and demand dynamics in some ZIP codes in Cobb based on better school districts and other positive factors account for different levels of price increases,” he said. “Barring some unforeseen negative economic event, it would appear this upward trajectory of prices and home-sales should continue.”
Comments
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Luek
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March 14, 2013
I don't get it. With all the foreclosed nearly new homes in Cobb why build more? Buying these newly built homes will be like buying a brand new car that depreciates in value as soon as it is driven off the lot. Better to buy a neary new car in the used car market and buy a nearly new house in the huge foreclosed home market. But there is no fixing stupid I suppose.
Point of View
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March 14, 2013
While this is good news, this too may come to a halt once the builders have exhausted the supply of pre-developed lots they have been able to buy out of foreclosure or distress. The price of raw land has not taken a hit and is still cost prohibitive in many areas to build the homes that are selling right now....all under 400K.
sp60
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March 13, 2013
Really? Why is Cobb even issuing permits?

With all the homes 'underwater' due to collapsing prices, they should limit new construction to finishing off already started development only.

We need to let the existing home market appreciate some before introducing competition with more new homes.
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