Home and Condo Sales Slump From July 2017 to July…
Atlanta Housing Market Report
What’s the outlook for greater Atlanta’s residential real estate market? Will house prices drop dramatically against the disappearance of buyers and sellers?
Next month, we’ll have those stats available, but it doesn’t take much imagination to know that sales will have dropped considerably. If Realtors can’t show homes in person, it’s hard to believe there would be many closed sales in March, and probably the same for April.
Atlanta has become an ideal place for companies to relocate to. The real estate prices are attractive and Georgia is a business friendly state. Site Selection magazine ranked Georgia “No. 1 for Business” seven years running (2013-19).
Atlanta’s population is growing by 90,000 per year and is expected to hit 8 million by 2040 from its current 6 million. The 5 year and 10 year forecast look very good.
Atlanta Realtor Report
Sara Sloan, an Atlanta Realtor says the market has been very hot. She’s showing homes online right now. All the more reason to hire a multi-talented real estate marketer to build substantial visibility and leads throughout 2020.
US Housing Market Stats and Forecast
February was a good month for most states and cities across the nation with home sales jumping 6.5% and home prices rising in February up 8% annually to $270,100. US home inventory fell 9.8% year over year to a 3.1 month supply, much better actually than Atlanta’s.
Strong demand with low housing supply generated one of the strongest rises in more than a decade. The US median home price. See more on the US housing market forecast.
Will Atlanta Come Back from the Shutdown?
As US cases of Corona Virus rise, the housing market may not recover until June to August. With millions unemployed across the country, the amount of money missing from markets is huge. The Georgia Department of Public Health COVID-19 Daily Status Report counts 4117 cases of Covid 19 in the state. Numbers are expected to rise but with warmer humid weather coming, it may not be a pandemic situation in Georgia.
Of course, Atlanta’s situation is minimal compared to the Corona Virus impact on the New York’s housing market. Corporations including real estate companies face a liquidity crisis. Many have interest payments due and Federal funds may not last long enough to help them avoid trouble.
While 12,000 workers filed jobless claims last week, that’s a paltry amount compared to California. Sales could drop up to 35% according to some forecasters and given the low supply, unemployed millennial buyers, low financial liquidity, and mortgage company fears, it stands to reason sales and home prices could drop drastically in April.
Georgia Housing Market Update
Home sales in the state of Georgia in March rose by an amazing 13.55% while prices only grew by 1.8%. However, listings have fallen 4% and home inventory is down 4.9% to 2.4 months. Sales are driven by Millennials forming households amidst a shortfall of homes. That would have lead to big price increases in the peak sales period of 2020.
Compared to last year, sales rose 9.2% and median sales price grew 5.3% to $243,000, a $13,000 gain. Active listings are down YoY to 18,163 units, a drop of 5.6%. Residential inventory is 6.25% from last February.
As in the sales chart above, sales have been tracking much higher this year despite the drop in listings. It would have been a near record year if not for the Virus shutdown.
Atlanta Housing Market Update
The Atlanta housing market grew nicely during February. Home sales grew 3.8% to 3866 units sold. Average home prices rose 6.6% YoY to $338,000. Median home price was $278,000, which was up 6.1% from last year.
In January 2020, sales were 3280 units, just slightly less than February. Inventory of homes in January were 11,483 units compared to 10,723 in February, a drop of over 700 units.
Year over year, housing inventory decreased a worrisome 16.3% from last February and listings dropped even more (down 19.9%) from last February. Home supply decreased to 2.1 months.
Atlanta Housing Prices and Sales
Nar reported the 4th quarter home prices for Atlanta-Sandy Springs-Marietta, GA. They had a 7.4% increase to $232,000.
Zillow Home Price Forecast
Zillow predicts Atlanta home prices will rise a further 4.7% by February of 2021.
New Construction in Atlanta
Without funding, and an expected drop of 3.5% in GDP, home builders may not produce the volume of new housing expected.
New Housing Developments in Atlanta
Curbed Atlanta reported 34 major development projects were underway last year in midtown Atlanta. This includes almost 2,400 apartments and condos under construction. Another 1,400 units are proposed.
Rentcafe cites the Atlanta community of Chamblee as have the fastest rent increases at a 44% clip over 5 year. During that time, renter income has fallen 8% and renter population has grown by 156%. That means high demand in a community of under 20,000 renters and 8400 homeowners.
Growing Demand for Rentals in Atlanta
Rentcafe cites the Atlanta community of Norcross as next in 5 year rent price growth here of 38%. Renter growth has grown 148%, yet renter income has dropped 17%.
The average rent price here is $1479 a month with 69% of rentals being between $1000 and $2000 per month according to Rentcafe.com. That makes it ideal for many incoming residents who may not see higher salary levels.
Atlanta’s population has grown as abundant job opportunities and affordable housing makes its mark in a country with very low affordability and housing crisis. The current situation isn’t all rosy. Georgia has problems with education levels, affordable health care, and a lack of suitably qualified talent.
Atlanta Georgia Economic Outlook
Benjamin C Ayers of UofG said: “We predict job growth in all of Georgia’s 14 metropolitan areas and in all of the state’s major industries. Georgia will benefit from several reliable sources of growth—including an impressive economic development team, favorable demographic trends, more homebuilding and real estate development, higher defense spending, continuing fiscal stimulus from recent tax cuts and faster productivity growth.”
Growth will slow as consistent with the overall US economic growth forecast, yet Atlanta’s employment growth will see 68,900 more jobs in 2019.
If the $5 billion plan for development in Atlanta’s downtown should push forward, the picture becomes much rosier.
Unemployment has dropped to 3.1% from last year’s 4.1% rate. New housing permits are expected to drop 3.8% after 2018’s phenomenal 10.8% growth. That still makes Atlanta’s employment outlook positive.
Atlanta Housing Market Hits a Turning Point?
With optimism continuing and the end of the Corona Virus period, Atlanta’s housing market should pick up where it left off. The GDP may fall but Americans have a lot of wealth to pick up the pieces and get the economy rolling again. What’s happening to Atlanta is no different to other cities. These are macroeconomic factors.
The stimulus plan and the continuing Federal tariffs on Chinese products will create a transition period of economic activity. As multinationals are forced to bring production to the US, cities such as Atlanta look very attractive. Atlanta is a distribution hub making it a smart location for a new American headquarters.
Atlanta companies should be lobbying multinational corporations and other foreign corporations to locate in Georgia. This is one of the biggest business events of the last 30 years and those smart entrepreneurs and financiers will draw them to Atlanta. Are you considering moving to Atlanta to live and work? It could be one of the best cities for 2020 and beyond to live and work in.
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