Metro Atlanta home prices are up 5.8 percent from a year ago, slightly less than the national pace, according to a high-profile national report issued Tuesday.
That climb – which put Atlanta in the middle of the pack for large metro areas – is solid but less intense than in preceding months, according to the S&P Corelogic Case-Shiller Index, which tracks resales of homes.
Of the 20 largest metro areas, prices in 15 grew more slowly than they had in the previous month, said David Blitzer, chairman of the firm's index committee. "Rising homes prices are beginning to catch up with housing."
Nationally, home prices are up 6.0 percent from a year ago.
The fastest growing prices are in Las Vegas, where average home values have climbed 13.7 percent in the past year, followed by Seattle, where prices were up 12.1 percent and San Francisco, with prices rising 10.8 percent.
But markets around the country – especially in Atlanta – have struggled with a relative lack of listings for homes to be sold. That trend may have bottomed out, but it has not yet reversed.
So the number of sales of existing homes have dropped each month for the last six months, Blitzer said: They are now at the level of July 2016.
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In Atlanta, there are other factors as well.
For example, while most first-time buyers are looking for prices in the lower tiers of the market, virtually no new construction has been for “starter” homes.
That fits recent economic trends, but doesn't answer the needs of people with modest incomes, said Bradley Raber, market analyst at the CoStar Group, which collects real estate data. "Atlanta has had a great economy, and a lot of the job growth has been at the top of the market."
John Rainey, vice president of Re/Max Georgia, said that the housing imbalance is largely a product of Atlanta's attractiveness as a city.
“It’s a desirable market with a growing population,” he said.
The price hikes have spurred investors and flippers, but even with the increases, Atlanta remains more affordable than some hotter markets, like Seattle, experts say.
And so long as the economy stays healthy – and prices moderate – the Atlanta market will look good, said Aaron Terrazas, senior economist for Zillow.
The biggest danger now is that the Federal Reserve might jack up the benchmark interest rate that, in turn, could spur much higher mortgage rates and slow growth, he said. “They are still low by historical standards. But over the next two years, depending on how fast they increase, it could pose a risk.”
Even the more moderate increase in prices is a lot faster than the typical wage is rising.
"Higher prices are stifling home sales as more buyers are priced out of the market," said Danielle Hale, chief economist for Realtor.com. "Affordability is only going to become more of an issue."
Average Atlanta home prices
Since last year: up 5.8 percent
Since trough in 2012: up 78.8 percent
Source: S&P CoreLogic Case-Shiller Index
Average Atlanta home price
Compared to pre-recession peak of 2007: up 8.1 percent
Source: S&P CoreLogic Case-Shiller Index
Fastest home price growth in past year
1. Las Vegas, 13.7 percent
2. Seattle, 12.1 percent
3. San Francisco, 10.8 percent
4. Denver, 8 percent
5. Phoenix, 7.5 percent
12. ATLANTA, 5.8 percent
Source: S&P CoreLogic Case-Shiller Index
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