Housing has always been Atlanta’s draw

Housing is to Atlanta what oil is to Houston, tourism is to Vegas, and financing used to be to New York.

We are a real estate town. The bigger, more famous names might be on the commercial side, known for their sky-reaching office buildings and financial centers, but the lure of Atlanta has been its affordable housing.

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Thomas Oliver can be reached at toliver@ajc.com

Cheap land, relatively cheap labor and proximity to the world’s busiest airport kept us on the leading edge of growth for decades.

Transplants for years were pleasantly surprised to find themselves in a much larger house in a much nicer neighborhood than their previous location.

Traveling salesmen, entrepreneurs and consultants found plenty of houses with more than enough space to serve as offices or storerooms and double as home sweet home after work.

We became a small business mecca. Inc. magazine regularly ranks us as a top city for entrepreneurs. Four years ago, we even topped Inc.’s list.

So, as our housing industry slowed in 2006, before coming to a halt last year, it hasn’t been just the builders who suffered.

Unlike housing recessions before, this one has been accompanied by falling prices, which of course has been a leading cause of foreclosures, which have dumped tens of thousands of houses onto the market.

As important as housing is to metro Atlanta, we aren’t suffering nearly as much as some communities. Atlanta home prices have dropped 6.6 percent since 2006, compared with Las Vegas (-32.1 percent), LA (-28.3 percent) and Miami (-31.7 percent).

Our recession is those cities’ depression.

We are relatively better off because we were never part of the housing bubble, says Eugene James, who directs housing research for Metrostudy in Atlanta.

And that’s because there was never a shortage of supply in Atlanta, according to John Wieland, founder and chief executive of Wieland Homes.

Atlanta can grow in all directions, Wieland points out, unlike the markets in Las Vegas, LA or Miami.

Now, however, we are suffering from an oversupply. Foreclosures have worsened the market glut. “Nothing gets better until we clean up our supply,” James said.

And the supply doesn’t get absorbed until people start buying houses, and people won’t start buying houses until lenders’ balance sheets return to, well, some balance and they get back to the business of making loans.

And that doesn’t stand a chance of occurring until Congress acts. Not the most comforting thought, as those who helped create this mess try to win the blame game.

Wieland says the bailout plan must also address slowing the rate of foreclosures.

More importantly, we need some degree of confidence to return to the market. “We need a sense that someone is in charge,” Wieland said.

Indeed.