Atlanta housing market continues to level off

By Michelle E. Shaw

The Atlanta Journal-Constitution

The metro Atlanta housing market continues to show signs of stability, according to a widely watched national index.

Though seasonally adjusted prices fell slightly in January, when compared to the year before, the gap between those values has been shrinking for the past several months.

The Standard & Poor's Case-Shiller Index, released Tuesday, showed seasonally adjusted metro Atlanta prices fell 2 percent in January from the year before and was virtually unchanged from December.

“With numbers like this, we’re going to have a super robust second quarter,” Steve Palm, president of Marietta-based SmartNumbers, said. “And I’m talking 20-30 percent up for the second quarter over 2009, to avoid a double-dip recession.”

Palm also believes the federal housing credit will help attain that goal. Home buyers who qualify for the credit must have their home under contract by the end of April and close the deal by the end of June.

“Those figures are certainly doable,” he said. “But if we don’t get there, we’re in trouble.”

Since June 2009, the year-over-year gap in the Case-Shiller Index has steadily narrowed. In June, prices were 14 percent lower than a year earlier. By August, that number dropped to 11 percent, to 6 percent in November and to 2 percent in January.

Small increments of change are positive indicators but real estate experts say there is still a long way to go before the metro area will see marked improvement.

“It is good that we’re not seeing large declines, but what we are cautioning people about when they look at the Case-Shiller numbers are the disruptions that have occurred in the market that may be skewing the index,” said Mark Vitner, senior economist for Wells Fargo. “I’m afraid that a lot of the most troublesome homes have been taken out of the market and that has biased the numbers a little bit.”

Vitner said there is “still doubt in the market,” which includes a number of foreclosures and homes that would have been foreclosed on if not for a foreclosure prevention program.

Nationally, the 10-city composite index in the Case-Shiller report was flat from a year ago, but is still down 30 percent from its peak in May 2006.