Metro Atlanta home sales
Home sales in the 11-county metro area fell during the first half of this year, mainly because there was a lack of houses on the market. Here are local sales figures for the first six months of each year.
Year…..Homes sold from January to June…..Percentage change
2011…..19,816…..up 7.8 percent
2012…..22,497…..up 13.5 percent
2013…..21,600…..down 4 percent
Source: Atlanta Board of Realtors
As the traditional home-buying season comes to a close, a paucity of homes for sale in metro Atlanta means sales have decreased when they are usually expected to rise.
Home-buying in the region usually peaks in the spring and summer months, when families can relocate without interrupting their children’s school years. But with the inventory of homes available for resale near all-time lows, even those who want to buy a house often can’t find one. There were just 4,065 homes sold in the 11-county region tracked by the Atlanta Board of Realtors this June.
Sales of single-family homes in the region fell 11.6 percent in June from May. They were down 12.4 percent in June from June 2012.
“Resale closings are down because there’s no inventory,” said John Hunt, a senior analyst with Smart Numbers, a real estate analysis service. “We’re 20,000 units short of where we should be.”
There is a lot of good news in the housing market: Foreclosures are down, prices are rising and the number of new homes under construction is up. But there is still a long way to go before the market can be considered healthy.
Because home values fell so dramatically from the peak, residents in large swaths of the metro region owe more on their houses than their properties are worth. That, in part, is keeping many people who might have thought about selling and moving into a bigger house from listing their home for sale.
Still more who are no longer underwater may be watching prices rise — they were up 20.8 percent in April, the latest figures available, according to the S&P/Case-Shiller Home Price index — and hoping to get more for their homes if they hold on to them longer.
In some cases, it’s the good news that leads to the slowdown. With fewer foreclosures, there are not as many cheap homes for sale. If the only sales in an area were $50,000 foreclosures, and no more are available, it causes inventories to drop.
All of that means that there are fewer homes available than there should be to satisfy demand, which is high. That leads sales to slip.
“We’re looking at metrics we’ve never seen before,” Hunt said. “We have raw inventory levels from the early 1990s, when we had half as many people in the city.”
Then, Hunt said, there were about 20,000 homes for sale in metro Atlanta. At the peak, there were 70,000 homes for sale. For there to be enough homes for the current demand, there should be about 40,000 houses on the market. The actual figures are about half that.
New construction is picking up some of the slack, he said, but wet weather has slowed building.
Most people tend to buy houses between May and August, Hunt said, but experts such as Nancy See, the president of the Atlanta Board of Realtors, said most of the seasonal buying in the pre-school rush has ended. She said her company, Atlanta Fine Homes Sotheby’s International Realty, saw a slowdown in sales in July, even though it has had a strong spring.
So did Bill Adams, the president of Adams Realtors. Adams had the strongest May he’s seen in 34 years in the business, with sales up 26 percent from the previous year. But June wasn’t as good as May, and July has been slower, too. Low inventory is even making an impact on popular markets.
“It’s gone from white hot to hot,” he said. “It’s a slower pace.”
In Jonesboro, Steve Bullard said he is seeing a severe inventory shortage. The president of Coldwell Banker Bullard Realty said there are fewer homes for sale that are owned by banks and fewer foreclosures. It’s good news, he said, but more is needed.
“Everything’s connected,” he said. “Lower sales, lack of inventory — that’s the key to everything.”
As people realize that the market is improving, they will again begin to list their houses, said Eugene James, the Atlanta regional director of the housing information company Metrostudy. Before that happens, though, there is a good chance that sales volumes will continue to fall.
In fact, Hunt said, inventory levels have been steadily falling since 2011. Since then, he said, the normal seasonality that’s expected in the housing market has been absent. He hopes it will kick in again by spring.
See, with the Atlanta Board of Realtors, said the market has been strong in some areas since this winter, as inventory continued to fall. March sales in the region were up 26.7 percent from February, and May sales were up 15.1 percent over April.
Now, potential sellers are staying out of the market, often because they don’t know where they would move if they made a sale. Rising interest rates may also lead some potential buyers to reconsider their plans. It all leads to a market the likes of which Atlanta has not seen.
“It’s very, very, very strange times we live in,” Hunt said. “This only changes when the local move-up buyer feels confident that they can sell their home.”
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