More than in any other major metro, home prices in metro Atlanta have been boosted by resale of formerly distressed properties, according to a report Tuesday.
The average sale price of Atlanta area homes rose 6 percent last year, but only 5.2 percent if such sales are excluded, California research and analysis firm CoreLogic found.
The differential was higher in metro Atlanta than in any other top metro area, the firm said, with Phoenix the only one close.
Either with distressed property resales or without, Atlanta had the fifth-largest increase in prices.
The effect of such sales highlights the impact of foreclosures and other distress sales on a region’s housing market. During a bust they drag values down as investors and bargain-hunters scoop up properties at far below prior value.
During a recovery, the same property often sells for much more than at its previous sale.
A year ago Atlanta showed double-digit increases in home prices, but the rate of increase has ebbed steadily in recent months. The deceleration has come despite strong demand in some areas and an unusually low number of properties for sale – normally a formula for higher prices.
That could be largely because the flow of short sales and foreclosures has dwindled, according to the CoreLogic analysis, leaving fewer cases in which a house is repossessed or sold very cheaply to an investor, then resold for much more.
CoreLogic projects prices nationally to continue to rise, albeit at a slightly slower pace: a 4.5 percent increase during the next 12 months, vs. 6.5 percent the past year.
“The current cycle of home price appreciation is closing in on its fourth year with no apparent end in sight,” said Anand Nallathambi, president and CEO of CoreLogic.
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