COBB COUNTY - Atlanta home sales continue to rise. But what about home prices? They’re barely rising at all and realtors are worried the fragile housing recovery may be crushed as a result.
A bulldozer levels the ground in a housing division near Lost Mountain, one of several going up in West Cobb County. Rezoning requests are pending in East Cobb that would clear the way for a 125 home development where the average house would cost upwards of $825,000. County officials and realtors alike hail these as signals that the worst housing crisis in 80 years is ending.
But there is increasing evidence that an aftereffect from the real estate collapse that began six years ago is threatening that recovery, according to one real estate expert. Michael Bunch at Keller-Williams believes that, while demand for housing is up and new homes are being built, “The prices are not rebounding.”
A big reason for that is the appraiser who sets the price on homes for sale, Bunch said.
“The appraisal could end up raining on everybody’s parade,” he warned.
Blamed in part for the wild rise in home prices before the bust, Bunch says appraisers are now overregulated and overcautious. In addition, they are working with “comps” – the value of comparable home sales in comparable nearby neighborhoods over the past six months when setting values on new sales. Those “comps” still carry the stain of devaluation left by that six year real estate bust.
Together, Bunch said those elements may not kill the real estate recovery. But he warned they could very well slow it tremendously.