The Road to Recovery
Published Summer 2010
Atlanta’s homebuilding market continues to experience tremendous growth.
Chinese philosopher Lao Tzu is credited with this famous quotation: “The journey of a thousand miles begins with a single step.” These wise words serve as a simple reminder when considering the state of Atlanta’s homebuilding industry. For years, housing markets across the United States were hit with slumping home prices, foreclosures and sluggish sales, halting the construction of new homes and neighborhoods. However, things are looking up for metro Atlanta’s market, and the first few steps have been taken toward the construction of more beautiful homes in the area.
David Ellis, executive vice president of the Atlanta Homebuilders Association, says, “Atlanta has always been a city where jobs push the market. We’re seeing resurgence in growth. There’s plenty of affordable land, which keeps homes more affordable. Then there’s a lot that has to do with consumer confidence. Builders are being really creative with the current situation, and many are working directly with banks to help with assets and to make sure homes are both decent and affordable.”
The housing market began its resurgence in the first-quarter of 2010, increasing to 1,517 units or 42 percent above 2009’s first quarter figure of 1,068. But it’s not just single-family builds that are attracting construction here. Atlanta-area builders are also busy constructing homes for 50-plus active adult housing communities. Jim Chapman of Jim Chapman Communities, for example, started developing these communities in 2005. He says metro Atlanta is drawing those 55 and older to relocate here or stay in the area but move into active adult communities, because of the area’s great weather, professional sports options, entertainment options like the College Football Hall of Fame and the world’s busiest airport, Hartsfield-Jackson Atlanta International Airport. “All these wonderful things attract people to this area, including even the jobs. Many of our residents do still work. I’d say at least one member of each household does. … There’s just a lot of attraction to the city of Atlanta and a lot of attraction to stay here, but the golden attraction is a grandchild,” Chapman says, adding that adult children and grandkids are often reasons why anyone 55 and older comes or stays in the area.
Traton Homes has taken a different approach with its building projects. Instead, the company has set its sights on communities with fewer home sites. “We are currently building in 11 new home communities in Cobb, Cherokee, north Fulton, Paulding and south Fulton counties and will be opening more new communities this summer,” says Kimberly Garwood, marketing manager for Traton Homes. Though the firm’s target demographic and style of homes hasn’t changed much, the demands for location have. “More and more buyers are looking for locations ‘closer-in’ today,” she says. That said, Traton’s strongest results have come from its projects in Cobb, North Fulton and within the Perimeter.
“Just like every other builder, Traton has been affected by the economic downturn. There are fewer buyers out there so it is more important now than ever that we as builders focus on what homebuyers really want,” says Garwood. “We are making sure that we are able to offer a good quality product with features that matter most to our customers at a price that is highly competitive in today’s market. Three-car garages are very popular and there continues to be a demand for both basement and traditional slab homes. We continue to develop new product to make sure we meet our customers’ needs.”
Today’s biggest housing markets are the same as they were five years ago, with Atlanta in the mix with other major players, like Seattle and Dallas. “The demographics are really showing job growth, so there is going to be a need for new homes. There are going to be things for builders to do in the future and the long-term prospects for housing are really good,” says Ellis. “Housing in Atlanta has always been considered an affordable commodity. There’s no reason for low prices to change once the market evens out again”