Atlanta housing prices up over a year, but are they dropping now?

Atlanta's home prices were up an average of 5.2 percent during the past year, slightly better than the gain in most large metro areas, according to a much-watched national survey that was released Tuesday.

Atlanta's price hike beat the 5.1 percent average increase for the top 20 metropolitan areas, according to the S&P/Case-Shiller House Price Index, a calculation based on a three-month average.

Of course, averages can be misleading and the gains in Atlanta have been uneven.

But Atlanta – like the larger market – has thus far been reaping modest success, said David Blitzer, chairman of the index committee at S&P Dow Jones Indices. "Supported by continued moderate economic growth, home prices extended recent gains."

The Case-Shiller index tracking national prices is just slightly below the record high set in July 2006, Blitzer said.

Price increases nationally have slowed, but there are some places still up strongly. Among the 20 largest metro home markets, Portland, Ore. continues to see prices rise most rapidly: up 11.7 percent in the past year. Average prices in Seattle were close behind, up 11.4 percent during the year. Denver saw a price hike of 8.8 percent.

Slowest growth was in New York, where average prices edged up 1.7 percent, and Washington, D.C., where prices were 2.3 percent higher.

In that ranking of the top 20 metros, Atlanta is tied for 12th-fastest growing, according to Case-Shiller.

“All 20 cities saw prices higher than a year earlier with 10 enjoying larger annual gains than last month,” Blitzer said. “The seasonally adjusted month-over-month data showed that home prices in 14 cities were higher in August than in July.”

The prognosis is still positive, he said. “Other housing data including sales of existing single family homes, measures of housing affordability, and permits for new construction also point to a reasonably healthy housing market.”

Atlanta was one of the strongest markets during the housing bubble and burst more painfully than most, suffering an estimated quarter-million foreclosures.

Progress in Atlanta and nationally have been steady since the housing market hit bottom in 2012. The nation's foreclosure rate has fallen to a nine-year low, according to Black Knight Financial Services.

Metro Atlanta foreclosures have likewise dropped, but much damage remains from the housing bubble and burst. In some areas, a high share of homes are still "underwater" – that is, worth less than the owner owes on the mortgage.

There are neighborhoods that have barely come back from the crash that followed the burst he housing bubble and the vicious recession. Some larger areas too remain burdened, especially on the south side of metro Atlanta: About 58 percent of Clayton County's homes are underwater, according to Zillow, a Seattle-based firm that collects and analyzes housing data.

Since hitting bottom in 2012, average prices in the top 20 metros are up 43 percent, but Atlanta prices have climbed more than 60 percent. That still leaves Atlanta prices just slightly below the peak of 2007.

But Case-Shiller takes a longer, deeper view datawise — it is lagged a month and based on a three-month — so it can sometimes be slow to show a turn happening in the market right now.

since the data reported today, there have been some cautionary signs.

Experts said the market had split – with a scarcity of sale listings among modestly priced homes and a surplus of homes for sale at the top end of the market.

So average prices are up solidly from a year ago, the pace of that rise was already slowing and in many parts of metro Atlanta there has been a turn south. said Nancy Keenan, a Realtor with Keller Williams who handles mostly listings on the north side of town.

“I would say that 90 percent of the homes on the market have had some price reduction,” she said.

While first-time homebuyers have worried about rising prices among starter homes, the recent change has hit harder at the high end, she said.

“For a couple months, we have seen very few sales at the higher prices,” Keenan said. “A couple months ago, there were falling sales over $800,000. Now that is happening at $600,000 and above.”

The shift will have a larger impact in coming month – and the impact could be disappointing to sellers, she said.

The “comps” that are used to appraise the next round of homes for sale will be the sales this fall of these lower-priced houses. That will make it tougher for next year’s sellers to raise prices significantly – or at all.

“We are having a major correction and it is going to hurt people come spring,” she said.

The current chill is partly seasonal – slower sales generally escort the lower temperatures. It is also a sign that the number of sellers’ listings at the high end may have gotten ahead of the buyer’s ability – or desire – to pay. That is partly new construction and partly a wave of longtime homeowners looking to sell.

And it is partly political, she said. “I think that with the election, a lot of people are tense. Things are bothering them that do not bother them normally. It doesn’t really have to do with which candidate wins. It’s the uncertainty.”