October 3, 2008 - (ATLANTA) - Metro Atlanta real estate professionals see a long road to stabilizing the area's housing market, even as home prices have inched up, according to a new survey by Georgia State University's real estate department.

Nearly half of the 40 industry professionals polled Thursday don't predict stability in the residential real estate market for more than two years. About 34 percent predict stability at two years.

Julian Diaz III, chair of the J. Mack Robinson College of Business' Department of Real Estate, says that while some data have shown a slight uptick in the sale price of existing homes, unsold lots abound.

"We're in a situation of a tremendous oversupply of lots," Diaz said.

The survey asked the real estate department's Honorary Board – CEOs, VPs, attorneys and others working in the industry – their thoughts on the health of markets around Atlanta and the impact of the $700 billion financial rescue package.

Nearly all believe the package will have some improvement on the real estate industry and about 37 percent believe it will take a year for liquidity to return to commercial real estate markets. Nearly 60 percent said Congress' failure to pass it would have a significantly negative impact.

"They're dealing with a situation where a lack of credit has locked all their markets up and they're not able to do anything," said Diaz.

The survey asked real estate professionals their thoughts on the overall health of the Atlanta real estate market and what they predict its condition will be in six months. Nearly 66 percent gave the current market a grade of "fair" and 18 percent said "poor."

Fewer than 60 percent predict a "fair" market in six months and some – 30 percent – predict a "poor" market.

"I think that says things aren't that good right now and they're going to get a little bit worse," Diaz said.

Indeed, 85 percent of those surveyed predict premium office space occupancy rates will slide in the next six months. Eighty-seven percent predict rental rates for those properties to fall with demand.

Asked which type of property investment might hold the most potential over the next six months, about a quarter said land, while 36 percent said multi-family residential properties. Diaz believes those surveyed may see demand for apartment housing rise with increased foreclosures.

Asked which regions of the metro area might hold the most potential, a third chose Midtown, while 30 percent chose the north side suburbs, 26 percent chose downtown, and 10 percent chose Buckhead. With its soaring foreclosure rates, no one chose the suburban south side.


Contact:
Michael Davis, 404-413-1361
University Relations