Metro Atlanta’s home prices continued their steady march higher in January, growing at a faster annual pace than the national average, a closely-watched report said Tuesday.
Prices in metro Atlanta climbed 4.9 percent compared to January 2014, according to the S&P/Case-Shiller Home Price Index. That was better than the 4.4 percent and 4.6 percent price gains seen, respectively, for the benchmark 10-city and 20-city indices.
On a monthly, basis, however, metro Atlanta prices actually cooled a bit, down 0.2 percent compared to December. Local home values generally sit at 2004 levels, compared to the depths of the recession when values tumbled to mid-1990s rates.
On a national level, Denver (8.4 percent), Miami (8.3 percent), Dallas (8.1 percent) and San Francisco (7.9 percent) showed the biggest year-over-year gains.
“The combination of low interest rates and strong consumer confidence based on solid job growth, cheap oil and low inflation continue to support further increases in home prices,” said David M. Blitzer, managing director and chairman of the index committee for S&P Dow Jones Indices.
But the market faces some difficulties.
“Home prices are rising roughly twice as fast as wages, putting pressure on potential homebuyers and heightening the risk that any uptick in interest rates could be a major setback,” Blitzer said. “Moreover, the new home sector is weak; residential construction is still below its pre-crisis peak. Any time before 2008 that housing starts were as low as the current rate of one million, the economy was in a recession.”
The metro Atlanta recovery also has been extremely uneven, an Atlanta Journal-Constitution evaluation of real estate data has shown. The issue of homeowners being underwater, or owing more on a mortgage than their home is worth, is a particularly troublesome issue for the region.
At the end of 2014, about one-quarter of metro Atlanta homes with a mortgage was underwater, according to Zillow. Only four other major metros had higher rates.
Read more about home prices later today at our subscriber website, MyAJC.com, or in the Wednesday print edition of The Atlanta Journal-Constitution.
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