Greater Atlanta Real Estate is Slow Out of the Gate for '25
Posted by Hank Miller on
A January toe stub for the greater Atlanta housing market. We usually get out of the gate early around Atlanta but not so much
this January. We in the field felt it, I was curious so took a look at the data…and it confirms what we thought. This is a stumble; this market will snap back, but we see a few reasons for this lackluster start.
I’m confident that a combination of factors impacted the January ’25 activity:
- Cold snap – Sounds dramatic (and it is) but the area had a couple of weeks of very cold weather and areas of snow and ice. That doesn’t play well in Atlanta
- Insurance Impact – Insurance costs are rising at insane rates. We’re seeing companies refuse policies on homes with “aged” roofs, with recent claims, in “high claim areas” and…
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If we subscribe to the "no substitute for experience" mantra, then a well seasoned agent is a home buyer's best asset. An experienced buyer's agent will actively look for signs of trouble in homes for sale. It's easy to follow "heart over head"; buyers tend to make an emotional commitment to a home. If it's strong enough, they can overlook issues that a sharp buyer's agent will note and bring up for discussion. Spotting signs of trouble in homes for sale is not learned watching videos and sitting behind a desk, it's learned in the field, getting dirty and educating the home buyers. Buying a home is a significant business transaction, treat it that way.
We're bullish on the spring '25 Atlanta real estate market. Now that the "interest rate" situation appears over and the election is done, this market can get back to being boring. Boring real estate is good, boring housing markets are safe and predictable. Significant challenges remain, but with the election over what appears to be an end to the "Fed Watch" on rates, things should settle down. One unknown is how agent compensation is received now that it is in effect. Q4 was the roll out, this spring will be a chance to see how that plays in a busy market.
I didn’t expect the answer Mr. X gave me, nor how fast he said, “I effed up, didn't use an agent”. At least he was honest in telling me; “I didn’t know what I didn’t know”. And I was honest in telling him; “now you do”. He described how a friend called and said a home in their community was coming on the market. They were told that the seller "already had interest and wasn't even going to list". This was one of the spots Mr. X wanted badly, so they jumped on it. Without a second thought, without contingencies, and without an agent. As he said, they now realize that a purchase of this magnitude should never be rushed or taken lightly. These are tough conversations and unfortunately, they happen often.
“Why didn’t mortgage rates drop when the Fed cut the discount rate?” A simple question with so many variables that even experts can’t agree. The focus seems to always be on “the Fed”; how does all of the economic news impact decisions made by the Federal Reserve? Through most of 2024, all eyes were on the Fed as everyone wondered if they would cut rates. They finally did in Sept and again in Nov…and mortgage rates, well, they remain about where they were. So, what happened? But, did anyone (other than the disingenuous media) really think rates were getting into the 5's or lower? No one here, nor anyone associated with legitimate real estate organizations, did.
The bite is severe and it’s going to get worse. HOA issues are on the rise, but the vitriol directed at them is not always justified. Homeowner associations exist to maintain property and community standards; to ensure that owners, their properties, and community property, meet agreed upon standards. Over the last several years, many HOAs have been financially stressed and that stress is being passed to residents. The catalyst was the Surfside Condo collapse, the mismanagement there was a clarion call to many.
