The gap did slip to that level back in 2007, when the Atlanta housing bubble was bursting and the market was saturated with thousands of new homes that developers were struggling to sell. During the next few years, as the economy slowly emerged from recession, the market soaked up the vacancies, the supply of new homes shrank and once again, they began to draw a premium.
A median new home sold for $234,500 in 2010. That was $56,600 more than the median price of a resale, according to Metrostudy.
The next year, the gap between new home and resale shot up to $104,900, or 45.8 percent than resale.
The gap represents more than just buyer preferences for new, unlived-in houses, James said. For one thing, new homes in Atlanta have for been getting bigger. Last year, the median home resale of a home was 1,916 square feet.
The new home in 2017 was 2,800 square feet.
Moreover, the technology of a newer home has made them better insulated and more energy efficient, which means that some of the premium will come back to the buyer in savings.
“Prices are going up everywhere. Interest rates are starting to go up too. So I think you’ll see some smaller houses being built in the Atlanta market – that is how builders will control the price point.”
But the economics of building smaller homes on smaller lots will likely push many builders – and buyers – farther away from the city, he said. “Watch how the Atlanta exurbs flourish this year.”
Metro Atlanta, average premium paid for new homes above the cost of a resale home
2005: 33.2 percent
2006: 37.4 percent
2007: 25.1 percent
2008: 23.8 percent
2009: 17.1 percent
2010: 31.8 percent
2011: 45.8 percent
2012: 70.5 percent
2013: 63.5 percent
2014: 57.7 percent
2015: 55.6 percent
2016: 58.3 percent
2017: 54.4 percent
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