The Atlanta housing market is in a tough spot for 2022. High prices and low inventory have left many hopeful homeowners asking: When will Atlanta housing prices drop?
According to a report by the Federal Reserve Bank of Atlanta, Atlanta housing is now officially unaffordable. The median Atlanta home price rose to $430,000 in May, the Atlanta Realtors Association reported.
However, the Joint Center for Housing Studies of Harvard University said recently that prices may begin to sink nationwide sometime soon.
“Rising interest rates have already taken some heat out of the homebuying market, and the historically large pipeline of new housing units under construction should bring some relief to tight housing markets,” the center reported.
According to the center, housing demand will decline dramatically in the long term due to population growth being at a 100-year low and an increase in death rates. In the short term, the center said that things will likely quickly improve if policy makers can tame inflation.
“Despite the chilling effect of high costs and rising interest rates, the near-term outlook for housing demand is still largely positive,” the center said. “Demographic shifts are favorable, unemployment is low, and wage growth remains strong. But housing demand hinges directly on the ability of fiscal policymakers to successfully cool inflation without causing a recession.”
According to Atlanta Realtors Association president Karen Hatcher, hopeful home buyers should still prepare for their house searches to take months.
“While interest rates are rising, they are historically still low,” she said in a news release. “We are continuing to see multiple offers on homes and offers above the list price. Buyers should continue to stay prepared for a search that could take months.”
Hatcher was even less hopeful for local price corrections in the association’s May 2022 market brief due to a continuing lack of inventory.
“We don’t expect any strong price correction coming soon even with the rising interest rates due to the lack of inventory,” Hatcher said. “Buyers on the lower end of pricing will be the most affected simply because there is extremely low to no inventory of starter homes or affordable housing.”
Depending on how policy makers decide to approach inflation on a local and national scale, the various red-hot U.S. housing markets may see some much needed cool downs.
About the Author
