“Home prices continue to rise across the U.S.” Blitzer says “However, even as home prices keep climbing, we are seeing signs that growth is easing in the housing market.”
A house for sale on Ridgeview Road in Dunwoody last month. (Jenna Eason / Jenna.Eason@coxinc.com)
The strongest jump was in Las Vegas, where prices were up 13 percent in the past year. Close behind were Seattle, up 12.8 percent, and San Francisco, where home prices were up 10.7 percent.
The weakest gains were in Washington, D.C., where prices edged up 2.9 percent during the past year, and Chicago, where prices were up just 3.3 percent.
Case-Shiller tracks only homes that have been previously sold, that is, it does not include new construction. But other surveys, like that of Re/Max Georgia, show even more acceleration in home prices.
Growth in population, jobs and income are generally the drivers of the housing market – and Atlanta has been a solid winner on at least the first two variables. However the metro area's median pay has inched up just 1.9 percent during the past year, according to Glassdoor.
And Atlanta has some other idiosyncrasies.
Lack of inventory – that is, a shortfall in the number of homes listed for sale – has bedeviled many markets, especially Atlanta. But with more buyers than sellers in the market, that imbalance has been shoving the price of homes upward.
Efforts to add to the inventory of modestly priced homes are relatively limited. Lower-priced homes exist, but many are in less desirable communities.
Now, there are some gravitational forces working to slow that rise.
For one thing, there’s higher mortgage rates, which effectively make houses more expensive by adding to monthly payments. And there are also affordability issues – the six-year run has far outpaced the growth in average wages during the same period, every year adding to the pool of people who cannot afford a house.
And in metro Atlanta, the lack of inventory is much more of a problem at the lower end of the market – the price tiers that are typically for first-time buyers. At the other end of the spectrum, among the higher-priced homes, there’s something of a glut.
Home price increases, past year
Top 20 cities, average: 6.3 percent
Las Vegas: 13 percent
Seattle: 12.8 percent
San Francisco: 10.7 percent
Denver: 8.3 percent
Las Angeles: 7.4 percent
Phoenix: 7.2 percent
Boston: 7.1 percent
San Diego: 6.9 percent
Detroit: 6.4 percent
Minneapolis: 6.4 percent
Portland: 5.8 percent
Atlanta: 5.7 percent
Charlotte: 5.7 percent
Source: S&P CoreLogic Case-Shiller