As the spring 2023 housing market around greater Atlanta picks up steam, in many areas it feels like deja vu all over again. The last two years were a ride for Atlanta area home buyers. Although low-interest rates were advantageous, a limited housing supply led to a grueling home buying experience. Atlanta area home sellers on the other hand, enjoyed historical sway and leverage. They could effectively name their price and state the conditions; buyers were willing to comply. Things changed fast, midway through ’22 rampant inflation and the Fed slammed on the brakes. Things quieted and the stage was set for the spring 2023 housing market in Atlanta.
Entering Q2 of 2023, there is no impending crash and many markets remain tight. While the larger market adjusted off the irrational and unsustainable mid 2022 run, things remain active and competition remains healthy. The charts below look back to Jan ’22 and consider the six main metro Atlanta counties of Cherokee, Cobb, Dekalb, Forsyth, Fulton and Gwinnett. You know already - EVERYTHING is local and we can run any micro market in minutes. Here's Roswell, GA using Altos Research.
Home Prices Around Atlanta
We see the ebb and flow of both list and sale prices. There are many variables and they play out here; we see the spring rush, impact of rising rates into Q3-Q4 and the market stirring again in Q1. We do not see any crash. Key points:
- Of course, sale prices are down from historic highs of mid ‘22, but they remain above Jan ‘22 levels. Prices are balancing around Atlanta, not crashing.
- Sale and list prices continue to increase as Q2 opens. This is usually the busiest quarter of the year.
- Sellers are again pushing list prices. Pockets vary but overall sale prices are a b1t below list through Q1.
Home Supply in Atlanta
Inventory remains the primary challenge for the Atlanta real estate market. Owners are not quick to surrender their low rate or updated home unless absolutely necessary. Buyers are seeing fewer quality homes and not so quick to consider the leftovers. Key points:
- Number of listings is up but we have not seen a significant spring bump.
- While about the same as last spring, many of these homes are overpriced, poorly maintained or otherwise compromised; buyers are willing to avoid them.
- Number of sales is down after a Feb ‘23 bounce. Attribute this to interest rates, the economy, low inventory and/or more disciplined home buyers.
Days on Market, % Sale Price
How much and how long; questions both buyers and sellers ask. This chart clearly shows the Q3-Q4 slowdown, both in terms of days to sell and what buyers paid in relation to list price. Key points:
- A balanced market has marketing times of 30-90 days. The climb over the last half of ‘22 seems harsh, as does the dramatic reversal in Q1. Still under 30 days, still a very active and robust market.
- Q2 of ’22 shows the craziness; homes were selling almost on list day, well over list price and with multiple offers. Second half of ’22 shows the slight drop as the markets moved to balance.
- Q1 ’23 indicates buyers remain active for those well-presented homes, times drop sharply and buyers stay close to list price.
Months of Inventory in Atlanta
Months of inventory is a good indicator of activity. It’s the number of active listings divided by the total number of sold transactions within the same month. Typically. 0-3 is a seller’s market, 3-5 balanced and 5+ is a buyer’s market. It’s a fluid number with various measurements, consider it a supporting data point. Key points:
- Spring of ’22 saw record low housing inventory in greater Atlanta as well as nationwide. That, and low rates, fueled the frenzy.
- The Fed’s rate increased literally slammed the brakes on housing for the second half of ’22. Total inventory grew as sellers no longer had their doors broken down.
- Q4 ‘22 saw MOI bump 4 but it moved back under 3 as Q1 ’23 ends. Sellers still retain the overall edge
The greater Atlanta real estate market bears no resemblance to the national reports. This area is fundamentally strong and did not experience the “zoom town” syndrome that many areas did. While those markets crash back, greater Atlanta remains active and stout. Everything balanced from the unsupportable highs, they had to, but the key word is balance. Atlanta is a diverse and vibrant area and despite national reports, the area economy is strong and local housing market remains competitive.Posted by Hank Miller on