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A frank assessment
Annual forecast from Norton offers optimism
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Frank Norton Jr., president of the Gainesville-based Norton Agency, talks about the local economy Tuesday during a joint meeting of the Cumming-Forsyth County Chamber of Commerce and the Rotary Club of Lanier-Forsyth. - photo by Jennifer Sami

Good, bad or ugly, Frank Norton Jr. said now is “an unbelievable time in this marketplace.”

“You need to use that word. It’s just unbelievable,” said Norton, president of the Gainesville-based Norton Agency, a commercial and residential real estate and insurance company. “I do believe today, in this point in time, there are more opportunities than ever before.”

Norton was the guest speaker at Tuesday's joint meeting of the Cumming-Forsyth County Chamber of Commerce and the Rotary Club of Lanier-Forsyth.

The area housing expert offered a sample of his annual Native Intelligence economic forecast, focusing on Forsyth County. The event drew nearly 150 people, up from about 105 last year.

"The sky is not falling in Forsyth County," said Jerry Bowman, chamber board chairman. “I think our business owners know that and that's why so many of them came [Tuesday] morning to hear Frank confirm it.”

Norton’s message -- titled “We’ve got a great story to tell” -- was optimistic, both about the past year and Forsyth’s future.

“Your county is faring better than most any other that I see across the region,” he said.

About 2,200 homes have traded hands in the county, said Norton, adding that the residential sales translated to about $729 million.

The county had the second lowest foreclosure rate in the metro area, behind only Dawson County.

The bad news, he said, is the “average sales price did dip."

"It went from $360,000 to $325,000," he said. "But if you look at my numbers, it’s still the highest average sales price in north Atlanta. The good news is you’re getting the right kinds of houses that are starting to pay ... in the way of services.”

Though down from 2007, area real estate sales in 2008 mirrored those from 2003.

Norton detailed housing progress through 2009, dissecting the market by season. Nothing will happen in the winter, he said, but taxpayers could see a possible second stimulus package come spring.

The season also will be the end of the bad news, he said. Summer will bring a return to a normal uplift, along with a property tax revolt. By fall, the market will see stabilization, big box stores will realize profits and custom homes will return.

“I’m actually predicting that 2009 is going to be slightly ahead of 2003 or 2008,” he said. “We’re not going to see a major dip. We’re going to see lots of opportunities in the second half of the year.”
Inventory, Norton said, has peaked and is now dropping at a significant rate. It’s the fourth-lowest housing inventory in metro Atlanta. There is less than a five-month supply of homes under $170,000 and less than a nine-month supply of homes under $300,000.

“We’re going to see shortages of spec homes in Forsyth County in certain price points and by certain elementary school zones," he said. "Those hot elementary school zones are going to have no product by spring time.

“Those bankers with guts will start to loan isolated product construction in those markets and by September/October, we might start to see some additional new construction.”

Because home prices are the best they’ve been in five years, Norton said, it’s still a buyer’s market. Sellers are pricing competitively and interest rates are in the mid-4 percent range.

“Homes are still a strong asset,” Norton said. “You bought a house, you lived in the house, you used the house, you enjoyed the house, you improved the house and you sold the house for more money. That hasn’t changed.”

Following the event, Neil Moore, a financial planner with Merrill Lynch, said he thinks prices will fall a bit further than Norton predicted, but he likely is “accurate that the second half [of 2009] is going to be a lot better.”

“He is more on the positive side, but I like that,” Moore said. “I think there are a lot of opportunities out there. With the market being down, you’ve got to look at the positive side of it.”

Alan Armstrong of Alan Armstrong Properties Inc. said Norton has proven himself as a statistician over the years.

“He knows what he’s talking about,” he said. “If you learn one key thing, then it’s worthwhile. And he helps align my business direction and gives me an understanding of what goes on in the market that makes me more attentive to the opportunities throughout the year.”