As the Joint Center for Housing Studies of Harvard University predicted, however, the soaring climb in mortgage rates caused by the Federal Reserve’s attempt to stifle nation-wide inflation has caused a bit of a cool down.
According to the Georgia Multiple Listing Service, a partner of the Association of Georgia Realtors, Atlanta’s median sales price dropped by $37,010 to a total $370,990 in September. Prices in the big city are on the decline. All the same, homes remain largely unaffordable for most hopeful Atlanta buyers.
A recent Realtor.com report revealed that three out of every four U.S. households can no longer afford monthly mortgage payments. It’s all thanks to mortgage rates more than doubling since the beginning of 2022.
To remain within the 28% debt-to-income ratio threshold suggested by most accountants, a modern Atlanta household needs to earn $116,890 a year before taxes to afford a median-priced home. That’s just shy of Realtor.com’s estimated six-figure household income of $124,000 on the national level.
According to the 2020 U.S. Census, the median income for an Atlanta household — not individual income — is $64,179 — a measly 54.9% of the necessary income.
The good news is that prices are on the downslope. The bad news is that prices are dropping because rising mortgage rates.