Home sales are down, but prices are up in metro Atlanta, according to a highly watched national report issued Tuesday.
Area home prices last month, on average, were up 0.3 percent, half as much as the month before, according to the S&P CoreLogic Case-Shiller Indices.
Over the past year, Atlanta home prices are up 5.3 percent.
Driving that increase has been an unbalanced market, which has generally been shifting toward the advantage of sellers, said Svenja Gudell, chief economist for Zillow, an online real estate data company. “The U.S. housing market entered a strange kind of twilight zone over the summer, in which home prices kept rising steadily, but actual home sales activity largely leveled off at fairly underwhelming levels.”
If you just look at prices, you don’t get the full picture, Gudell said.
“It sets up a situation in which the housing market looks largely healthy from a 50,000-foot view,” she said.
There are still a lot of people looking for homes, but many of them are first-time buyers, angling for lower-priced houses. And the supply of lower-priced houses listed for sale is limited, meaning many of those potential buyers come away empty-handed.
The shortfall in supply has been caused by insufficient homebuilding, Gudell said.
“It’s time we stopped sugarcoating the truth with this data — the simple fact is that we are severely under-producing housing in this country. Inventory is stuck at roughly mid-1990s levels, but the country has grown by more than 60 million people since then.”
Even so, Atlanta’s prices are not rising as fast as they were. And among the nation’s largest metro areas, Atlanta has continued to slide lower on the list for home price growth.
The 20 largest metros have seen a 5.8 percent increase in prices. Among those, 14 had faster rates of growth than Atlanta, according to Case-Shiller.
The fastest price increases came in Seattle, where home prices spiked 13.5 percent on average during the past year. Second-fastest growth was Portland, Ore. where prices were up 7.6 percent.
David Blitzer, chairman of the index committee at S&P Dow Jones Indices, said there are some signs of ebbing energy in the housing market.
“While home prices continue to rise, other housing indicators may be leveling off,” he said. “Sales of both new and existing homes have slipped since last March.”
Another crucial indicator of consumer finances are auto sales, he said. “Auto sales peaked last November and have been flat to slightly lower since.”
The market in coming months will face challenges, he said. One is the need to rebuild housing destroyed by hurricanes in Florida and Texas, the other are the Federal Reserve’s moves that will likely push mortgage rates higher.
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Average yearly increase in home price by metro area:
Seattle, 13.5 percent
Portland, 7.6 percent
Las Vegas, 7.4 percent
Detroit, 7.3 percent
Dallas, 7.3 percent
Denver, 7.2 percent
San Diego, 7.1 percent
Tampa, 7.0 percent
Boston, 6.8 percent
San Francisco, 6.7 percent
Charlotte, 6.4 percent
Los Angeles, 6.1 percent
Minneapolis, 5.8 percent
Phoenix, 5.6 percent
Atlanta, 5.3 percent
Source: S&P Dow Jones Indices