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Tough Market: Housing Crisis in Atlanta


One of the most important campaign issues in the current presidential race, the “housing crisis” is one that evoked a wide range of responses and of course, proposals to ‘fix it.’ For there is no denying, as Hillary Clinton recently put it, “our economic crisis is, at its core, a housing crisis.”

The two being implicitly tied, it has not just affected homeowners but also renters. Residing in properties being foreclosed, renters are also being evicted. Many have further been shut out from buying a home due to stricter lending rules. Additionally, homeowners forced into foreclosure are becoming tenants again and driving up rents. According to the National Association of Realtors, the average rent is expected to rise 5.3 % in 2008, up from 3.1 % in 2007.

Mark Duda, a Harvard University researcher, analyzing foreclosure trends recently told the Atlanta Journal Constitution, that large numbers of subprime loans, extensive mortgage fraud and large quantities of housing stock place metro Atlanta among the nation’s hardest-hit markets.

Here NRI Pulse spoke to a few readers to see what they have to say:

“I recently bought a new house in a better school district but because of the housing crisis, I haven’t been able to sell my old house. Initially, I was really worried about paying mortgages on both houses but luckily, things worked out in my favor. I am now renting the old property and have been able to cover the mortgage. The current contract I have with my tenant expires in August and I just hope that I am able to find another renter soon. Otherwise, it would be quite difficult.”
Vijay Verma, IT Professional, Forsyth County

“I don’t think things in the real estate market are going to change very soon – it will take at least year or a year and a half for things to change. But this doesn’t mean that renters wanting to become homeowners should wait for prices to fall further still. Once you like the property, don’t get greedy. You may not be able to find something quite like that again. Renters are often under the false impression that prices will fall further in a month or so but it’s not always by much. It is better to negotiate instead. For us as realtors also, the market has gotten quite tough. It has become very competitive right now and you have to be on top of your game. You can only relax when you get a commission check in your hand and in this market, it’s 10 times harder.”
Divyesh Patel, Realtor, Atlanta

“I lost my job in December 2007 and since then have been looking for work. But because of the downturn in the economy, it’s been quite hard. I have now gone back to school and am trying to improve my chances in the job market. Recently, I had to borrow money from some good friends to save my house and meet my mortgage payments. I think during times such as these when the economy is almost in a recession, the government should put into policy a system through which mortgage notes are based on income. So if you are unemployed, the payments should be lowered accordingly. And once you find a job, and have received your second payroll check – that way giving you enough time to settle things – the payments can then resume again. I think this would help a lot of people from going further into debt and losing their homes.”
Susie Keys, DeKalb Tech student – Criminal Justice, Clarkston

“Right now, the market is only good for those who have cash in hand or prior approval from lenders. And really, the fact is that we haven’t yet hit rock bottom and things are going to get worse with the market. As I understand it, the second quarter reports will show that more foreclosures have taken place in July than in March. As part of this cycle, rents are also going up. The crisis has also hit those working in the real estate market. Last month, over 6,000 realtors surrendered their licenses. It’s hard to sell in the current market as there aren’t enough qualified buyers and realtors have to keep paying out of their pocket for advertising and marketing. Many agents have been going up to 90 days without paychecks… My company offers licensing classes and at one time we used to see about 80 or 90 people attending but these days we see just about 10 or 15.”
Narender Reddy, Realtor, Atlanta


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