Potential Seen in Georgia Despite Presence of Distressed Properties

The number of foreclosed and distressed properties has remained elevated in Georgia since the start of the housing market crisis. Investors, however, see a lot of potential in the state's housing industry and most are expecting home building to pick up as early as this year.

According to some investors, although Atlanta foreclosures have pulled down the prices of residential properties in the area 26% lower than their peak, the market is still one of the best places to invest in real estate. At first glance, the state of Georgia seemed like a bad bet, with Metrostudy data showing an unsold home inventory of around 5,000 units equivalent to a supply of half a year.

However, things are looking up despite the high number of foreclosures in Georgia. The supply of vacant residences in Atlanta alone declined by 36% last year, one of the biggest drops in the whole country in 2010. The inventory of unsold houses is expected to decline further this year as various economic indicators in the region improve.

The supply of distressed properties is expected to be lower this year as job creation escalates in the region. In January 2010, private industry employment in Atlanta hit record lows. However, since January of last year, private sector jobs have added another 35,000 to their tally, and the whole state has seen a big jump in population during the past decade. Census figures showed that Georgia recorded a 20% population growth between July 2000 and July 2010, which is twice the pace of nationwide population growth.

In addition, only around 8.6% of subprime loans in the state are accounted for by list of foreclosed homes for sale; a percentage that is way below the nationwide rate of 13.2%. Investors stated that, although it will take some time for home builders to start constructing homes again once the inventory has cleared, the state is still in a better position than other U.S. regions.

A lot of investors have stated that, among all U.S. states, Georgia has one of the best chances of recovering faster from the impact of foreclosures and distressed properties. They claimed that the region will be a good place to start investing in real estate again.