The housing market's slow shift from a seller's dream toward a state of equilibrium continued last month as the number of potential buyers in metro Atlanta dropped and the number of homes for sale grew, according to a report from a local real estate group.
Metro Atlanta home sales in December declined 21.3 percent compared to the same month a year ago, according to the Atlanta Realtors Association.
That followed a national pattern for the month. Experts blamed buyers' caution on uncertainty about interest rates, a volatile stock market and concerns about the economy. And while the median price of a home was up 7.6 percent for the whole year, it inched up just 2.3 percent in December.
Housing prices largely depend on who has the whip hand – the buyers, with lots of choices, or the seller, with lots of offers.
In recent months, listings of homes for sale have started to grow again, making the overall market more balanced, said DeAnn Golden, president of the Realtors group. "The Atlanta market closed out the year in a stronger position of available homes than it did in 2017, due at least in part to the growth in local listings in the last quarter."
Re/Max too has seen an uptick in supply.
While using data from a larger area than that used by the Realtors, Re/Max Georgia sees parallel movement in the market, according to John Rainey, Re/Max regional vice president.
The price rise is a direct result of “very low inventory,” Rainey said. “While greater Atlanta is moving towards a balanced market, low inventory and affordability are slowing down the much needed balancing of supply and demand.”
That has meant a deceleration in the pace of price increases.
Home prices have risen steadily for more than six years, hitting a median of $268,000 last month. Much of the rise was driven by a scarcity of homes for sale. That was good for sellers, but sparked concerns about affordability since prices were rising much than most wages.
According to calculations by Attom Data Solutions, in 2018:
- Fulton's median home price was up 6.9 percent while wages were up 1.8 percent.
- Cobb's home price was up 7.1 percent while the weekly wage was roughly flat.
- Gwinnett's median home price jumped 9.3 percent last year, while wages inched up 0.2 percent.
- DeKalb home prices rose 11.7 percent on average last year. Wages edged up 2.2 percent.
- Clayton last year saw home prices soar 20.5 percent, but the county was hit harder than most areas by the housing bust, so it still has the lowest-priced homes of the core counties. Clayton wages last year grew 5.8 percent.
Currently, Georgia ranks 20th nationally for affordability, according to Bestneighborhood.com, a Utah-based start-up that offers local housing information.
Decades of growth in Atlanta and Georgia have been pegged to relatively lower prices. And after plunging during the recession, prices have surged,with a roughly 25 percent climb in the past three years.
"That can't go on forever," said Daryl Fairweather chief economist of Redfin, a national real estate broker. "Now that price growth has slowed down and more homes are sitting on the market, buyers will have the upper hand in 2019."
The number of homes for sale in December was up 12.7 percent from the levels of a year ago, according to the association.
The more homes for sale, the less of an auction-like atmosphere, agents say.
"What we are seeing is that the day of the multi-offer, bidding war craze of last summer, those days are gone," said Jessica Houghton, an Atlanta realtor with Compass. "I think there's been some volatility in interest rates in the third quarter last year that made for some hesitancy about buying."
Number of homes sold in December
Cobb: 607
DeKalb: 506
Fulton: 671
Gwinnett: 764
Source: Atlanta Realtors Association
Metro Atlanta housing, compared to a year ago
Total sales: -21.3 percent
Median sales price: up 7.6 percent
Source: Atlanta Realtors Association
Affordability
Percent of wages needed to buy a home with 3 percent down
Fulton: 36.1 percent
Cobb: 38.8 percent
Gwinnett: 40.6 percent
DeKalb: 32.3 percent
Clayton: 16.1 percent
Note: Calculation using median wages, median home prices
Source: Attom Data Solutions
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