More homes for sale, but metro Atlanta buyers still at a disadvantage
4 mins read

More homes for sale, but metro Atlanta buyers still at a disadvantage

“Mortgage rates are over 7%,” said John Ryan, Georgia MLS marketing director. “And you have to remember that this is for people with exceptional credit. For other people, I’ve seen mortgage rates well over 8%.

After the average 30-year mortgage rate hit 7.79% in October, it slipped in subsequent months, according to Freddie Mac, which buys mortgages in the secondary market and tracks their levels. In April, it was the first time since the beginning of December that the average mortgage rate exceeded 7%.

It was 7.22% at the end of last week.

People on lower incomes are less and less able to find a home to buy. According to a report from national brokerage Redfin, just over a quarter of home sales are to people with incomes below $67,900. More than 40% are intended for people whose income exceeds $123,000.

Still, late spring is typically the peak of housing demand, as many families attempt to make a purchase in a new school district in time to move before the next school year begins in August. And the market still hasn’t returned to pre-pandemic buying and selling levels.

Inventory – that is, the number of homes listed for sale – has been the lynchpin of rising prices. With fewer homes available to meet demand, buyers are pitted against each other and the more buyers bid on each other, the more prices rise.

In a balanced market, where buyers and sellers have approximately equal bargaining power, the number of listings represents approximately six months of sales. But in recent years, stocks have always been less than half that.

The result was a seller’s market and rising prices.

A built-in correction is possible: Higher prices generally convince more longtime homeowners to list their homes, balancing supply and demand. And over the past month, active listings increased 46% from the previous year.

But listings were so rare that even a big surge wouldn’t bring the market back into balance. Inventory is now the highest since October 2022, and it’s still barely half of what it was five years ago, according to Realtor.com.

Part of the reason is that new construction has been very depressed for so long. But it’s also because many aspiring salespeople feel “locked in.”

Many bought their own homes with exceptionally low mortgages and prices. Now, if they sell and want to buy something else, they will face the consequences of rising prices as well as high mortgage rates. So they don’t sell.

“It’s the lock-in effect,” Ryan said.

It’s not just rates that are disrupting the market. On the buyers’ side, high prices are a lot of it, experts say.

As the pace of price increases has slowed and many people have seen their wages rise in recent years, first-time home buyers are finding fewer options within their price range, so listings the most affordable ones sell out quickly, according to Georgia MLS.

The largest number of homes sold last month were priced between $300,000 and $400,000. It’s also the price point with the most homes listed for sale, the MLS said.

Forsyth is the most expensive county in the central dozen centered on the city of Atlanta, followed by Fulton, Fayette, Cherokee and Cobb. The most affordable homes sold last month were in Clayton, where the median price was $266,918.

The second cheapest county was Douglas, with a median of $342,740.

Across the 12 counties, 17.7% of sales were made in cash, generally above and beyond low-income buyers. A year ago, it was 18.2%.

With so many young professionals renting homes and apartments in metro Atlanta, there’s potential for a buying frenzy, said Kristen Jones, owner of Re/Max Around Atlanta. “There’s still a ton of pent-up demand. »

That demand will remain largely pent-up for now, and the situation is likely to get worse for at least some potential buyers, Jones said. “Values ​​will continue to increase as long as stocks remain low. The economy is all about supply and demand.


Metro Atlanta housing market, March through April

Houses sold: +5.5%

Median price: +0.7%

Active ads: +7.8%

Metro Atlanta Real Estate Market, Past 12 Months

Houses sold: +9.5%

Median price: +3.8%

Active ads: +46.0%

Average sales price, April, metro Atlanta

Cherokee: $577,531

Clayton: $266,918

Cobb: $540,680

DeKalb: $500,371

Douglas: $342,740

Fayette: $580,109

Forsyth: $758,960

Fulton: $709,195

Gwinnett: $498,044

Henri: $379,290

Paulding: $386,933

Rockdale: $346,605

Share of buyers by household income

At $42,438 or less: 4.5%

From $42,439 to $67,900: 22.6%

From $67,901 to $102,670: 28.8%

Median household income, metro Atlanta: $84,876

Share of homes whose listing price was reduced for sale, April

2020: 18.7%

2021: 9.9%

2022: 11.8%

2023: 15.3%

2024: 19.4%

Sources: Georgia Multiple Listing Services, Redfin, US Census Bureau