Welcome to the bottom: Part Three

Excerpts from an article by Adrian Sainz, David Twiddy, Daniel Wagner, Alex Veiga, AP

The South

The real estate market in the South remains one of extremes.

On one end, are oil-rich cities in Texas, Arkansas and Oklahoma that nearly skirted the housing recession altogether. Tipping the scale on the other side are foreclosure-ridden areas in Atlanta and swaths in Florida where prices are still falling annually by double digits.

Taken as a whole, home resales in the 17-state region rose 10% in the first half of this year on a seasonally adjusted basis, and are off just 4% from June of last year, according to the National Association of Realtors.

"Generally speaking, the rate of decrease, both in sales and prices, has started to bottom," says the University of North Carolina's Cumbie. "But that doesn't mean it's going to come roaring back."

Mass layoffs at Bank of America and Wachovia, for example, have taken their toll in their home state of North Carolina. Home price declines in Charlotte accelerated this year, and home resales in June were off nearly 30% from last year.

Home and apartment construction, a key economic engine, will also vary widely across the region. Parts of the South, notably Florida and Atlanta, were vastly overbuilt during the housing boom. So construction in the region rose a meager 7% in the first half of the year, the lowest of the four regions, according to the Commerce Department.

There was little reason for builders to start laying new foundations. New-home sales fell 2% from January to June, the only region in the country to post a decline.

"In the longer term, I'm confident that the real estate market is going to shift where buyers are coming out not only because of attractive interest rates and low prices, but because more people are getting jobs," says Les Simmonds, president of L.G. Simmonds Real Estate Corp. in Longwood, Fla. an Orlando suburb. "But, as we speak, it's not right. It's going to take more time."

Southeast states: Alabama, Arkansas, Delaware, D.C., Florida, Georgia, Kentucky, Louisiana, Maryland, Mississippi, North Carolina, Oklahoma, South Carolina, Tennessee, Texas, Virginia, West Virginia.

Data compares June vs. January and June vs. June 2008:

• Home resales: up 10%; down 4 percent
• Median price: $163,200 up 14%; down 12 percent
• New-home sales: down 2%; down 34 percent
• New home construction: up 7%; down 44 percent
• Mortgage delinquencies as of March: 12.7 percent

Regional outlook: The southern market has several characteristics that could help it recover, Cumbie says. The population continues to grow and businesses continue to move into the region. But the weight of foreclosures and job losses stretching into next year could delay any meaningful recovery.