Atlanta Housing Market Update 2022

Atlanta Housing Market At A Glance

It’s no secret that the Atlanta housing market has been on fire for the last two years. The cause? Historically low mortgage rates and the coronavirus. People tried to flee largely populated areas to get to the less dense suburbs. Current homeowners didn’t want to sell their current property, and new construction was down due to a lack of labor, all leading to a shortage of homes, new and existing. So what does the rest of 2022 have in store for the housing market?

Home Sales Are Slowing

Two significant factors are slowing home sales right now: rising interest rates and more homes are coming to market. It looks like the seller’s market is turning more to a buyer’s, or at least becoming a more stable, normal real estate market.

Kam Williams recently stated this in Atlanta Magazine:

The days of having a listing come on at 5 o’clock, and having to see it by 5:05, and having 40 offers on one property—we’re not having that anymore,” she says. “Now buyers are a bit relieved. If they see something, they don’t have to run out in the next two seconds

Read The Full Article Here

This leads us to our next question that has a lot of people concerned –

Are We Headed For A Crash?

Many people are worried about another crash like that of ’08. In fact, Google trends show that more people are searching the term “housing crash” and similar terms more than at any time since ’07.
If you listen to the news, it’s all gloom and doom, but the market data doesn’t support it. Some experts predict a housing market correction.

The housing crash of ’08 was due to banks’ loose lending standards and an overabundance of homes. Banks aren’t giving out the risky loans they did years ago, and foreclosures still remain low. Housing inventory still remains critically low overall. However, metro Atlanta’s housing inventory rose to its highest level since September 2020. This gives more proof things are turning in favor of buyers.

Again, what we are seeing is a return to a normal market.

What’s Making The Market Turn?

Rising interest rates are a real problem for some would-be buyers. Prices of homes are still extremely high. The median price for a home in Atlanta is over $400,000, the price alone is driving out a lot of young and first-time homebuyers, and rising interest rates only exasperate the problem. For instance, a 2% rate increase from a fixed rate of 3.5% to 5.5% on a $300,000 home would mean an increase in monthly payments of over $350.00. So, in theory, this will affect buyers on the lower end, having less inventory and competing with other buyers wanting the same property.

What’s Ahead For The Rest Of 2022?

We wish we had a crystal ball, but we don’t, so all we can do is follow the market data.

Housing inventory remains extremely low. Many would-be sellers don’t want to sell because of rising interest rates and lose the low 3.5% rate they have now. However, people will become used to the higher interest rates and continue to buy. If you need to move because of a job transfer, it’s out of necessity, not luxury.

Rising interest rates will definitely slow new home construction. The data is already showing fewer permits being pulled for new home construction.

Our take:

We think things will continue to slow, especially if interest rates continue to rise. Rising interest rates are the only hedge the Fed has against inflation. Inventory remains extremely low, which will keep prices high, but we will see a small correction in prices as we are already seeing sellers having to lower their asking prices in some areas.

As a reminder, if you have a home that you have inherited, are a tired landlord, have a house that is ugly or pretty – we would love the opportunity to make you an offer on it, just get in touch with us!

Is The Atlanta Housing Market Slowing

News / By Mandich Property Group

Today’s Pulse On Atlanta’s Housing Market

For a few years now housing prices have been steadily climbing higher, especially in the Metro Atlanta area. If your house was immaculate or at least in decent condition, it would sell. Chances are you would have multiple offers on your property. But things look like they are changing.

First things first, if you have a property anywhere in the Metro Atlanta area, we would like the opportunity to make you an offer for it just the way it is. No hassles and a fast easy sale. You can contact us at (770) 756-8680 or visit this page and complete a short form and we will contact you shortly.

Okay – now on to why you are here – to learn what’s happening in today’s real estate market.

Bidding Wars Are Down

It looks like the days of putting a property on the market and the price getting run up by multiple offers are becoming a thing of the past for sellers. Don’t believe us? Check out this from Redfin’s Blog about bidding wars by Dana Olsen:

Just 10.4 percent of offers written by Redfin agents on behalf of their homebuying customers faced a bidding war in August, down from more than 42 percent a year earlier. That overtakes last month’s 11.4 percent bidding-war rate as the lowest on record since at least 2011.

The national bidding war rate reached a high of 59 percent in March 2018, then started to drop as homebuyers reached their limit with sky-high housing prices and rising mortgage rates in the middle of last year. As the housing market has cooled slightly, so has competition to purchase homes.

Continue Reading – 10% of Redfin Offers Faced Bidding Wars in August, a New 8-Year Low

We suggest you visit that page and look at the graph that shows the National trend and you will see it hit a peek of around 60% in 2017 nationally and is now down around 10%.

Recession Fears

If you watch any news at all you know that we are in the midst of a trade war with China. While we believe this hurts the Chinese more than us, yet it still reeks havoc on the Stock Market. Add to that every other country in the world has a slowing economic market. All of this makes buyers think twice about purchasing a property, especially if they think there is a down turn about to happen. Everybody remembers the housing bubble of ’08, it’s fresh in their minds. Also there was an inverted yield curve in the month of August, which is usually a good indicator of a recession looming.

Lisa Chamoff wrote about this in a recent post on Forbes:

Homebuyer confidence is dropping, and more than half of current house hunters plan to put their home search on hold until the economy recovers, according to survey data released this week by Realtor.com.

The survey this month by Toluna Research found that more than 36 percent of 755 active home buyers expect the U.S. to go through a recession next year. This is up by about 6 percent when shoppers were asked the same question this past March.

Continue Reading – More Than A Third Of Home Buyers Think A Recession Is Coming

Atlanta’s Housing Market

So where does Atlanta’s housing market fall in all of this. Inside the perimeter we are seeing some change. We have seen properties listed longer as well as sellers having to slash their asking price.

Michael E. Kanell had this to say about it in the AJC earlier this year:

Yet the number of homes sold during the month was 8.9 percent below that of March 2018 as fewer buyers and sellers found common ground. Home sales volume has been declining for several months in metro Atlanta, including a 7.4 percent drop in February.

Read The Full Article Here

Over the years we have always seen inside the perimeter to be effected first, then spread to the surrounding counties.

So Are We Headed For Another Housing Crisis?

In all actuality, we don’t think so. There were two major factors that really had an effect on the crash of ’07-’08.

First, there were a lot of homes available. Builders were going crazy putting up new subdivisions everywhere throughout the Metro Atlanta area. The supply far outweighed the demand.
Second, Banks and Mortgage companies were making very risky loans and basically lending money to people that couldn’t afford to make the payments. Since the crash though lending standards have tightened up, to a degree.

In Conclusion

So what’s the take away from this? We do think there will be a correction coming, no market keeps going up for ever. At some time there has to be some sort of correction and prices will probably drop a bit. If the China trade war continues or there is some other global economic catastrophe, it may be a little more severe. However, we aren’t trying to paint an all “Doom and Gloom” scenario!

Bottom line, if you have a house that you are thinking of selling, now is the time to do it. This is especially true if you have a house that is a “handy-man special” that needs some repairs or needs major work and you can’t afford to make the repairs and need to sell as is.

Even if you house is ready to list with an agent – it’s still a good time to sell. Better now than later and have to wait until after any correction because you never know how long that will take.

Here’s a short video that goes over a few of the points we covered and will expand more on these thoughts: