Atlanta home prices rose 6.1 percent during the past year, beating the 5.3 percent average gain for large metro areas, according to a much-watched national survey released Tuesday.
That placed Atlanta seventh among 20 metro areas in the S&P/Case-Shiller House Price Index, which calculates a three-month average of prices across the country.
Despite stalling in November, according Case-Shiller, metro Atlanta’s average price has surged 62 percent since hitting bottom in 2012. It is now 2.2 percent below the pre-recession peak of July 2007.
Atlanta – like the nation – may be finally putting the crash of the housing market and the painful recession to rest, argued David Blitzer, chairman of the index committee at S&P Dow Jones Indices.
The average for the country’s largest 20 metros has risen 43.3 percent from the 2012 trough and is 7 percent from the previous peak.
“One can argue that the housing market has recovered from the boom-bust cycle that began a dozen years ago,” Blitzer said. Economic fundamentals such as job growth are strong, he said.
Many metro Atlanta real estate industry pros predict a strong spring. But some also see signs that the momentum is starting to fade.
The number of transactions in December fell from a year earlier, according to Re/Max Georgia. And while there’s been a two-day decline in the average time that a home is listed over the past year, listing time has risen nine days since November.
“I do not know the timing. I cannot tell you when,” Peter Vekselman, a metro Atlanta investor and consultant, said. “But real estate is a cyclical business and I think we are about to embark on a down-cycle.”
Higher interest rates won’t help, especially at the lower end of the market, he said. “When you see more ‘for sale’ signs just sitting there in the front yard,+ that’s when you’ll realize it’s really slowing down.”
In the Case-Shiller report, Seattle posted the biggest price rise, 10.4 percent, in the past year.
From November to December, the top 20 metros saw an average increase of 0.2 percent. Metro Atlanta, with a 1 percent monthly gain, was fifth behind Boston, New York, Denver and Tampa.
The “familiar forces” of high demand and limited supply are continuing to push home prices up faster than most American incomes, said Svenja Gudell, chief economist for Zillow.
“Rising mortgage interest rates will also impact home affordability, if only modestly at first, which could also erode some of the affordability advantages of buying over renting and further cooling demand,” she said
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