Four themes that define the Atlanta area housing market

The metro housing market remains a tough one for many would-be buyers. Here’s why
WIth many Atlantans heading for vacations -- and interest rates still high -- the housing market cooled as summer was arriving. Here, a Dunwoody home listed for sale in late June. J. Scott Trubey/

Credit: J. Scott Trubey

Credit: J. Scott Trubey

WIth many Atlantans heading for vacations -- and interest rates still high -- the housing market cooled as summer was arriving. Here, a Dunwoody home listed for sale in late June. J. Scott Trubey/

The story of metro Atlanta’s housing market for the past couple years has been a shortage of supply, soaring prices and persistently high interest rates straining buyers and constraining sellers.

The most recent sales data for the month of May show supply is growing as high prices and high costs to borrow mean homes are staying on the market a little longer. Meanwhile, more sellers seem ready to list their homes.

But overall, the Atlanta area continues to have an imbalance between supply and demand, making it a difficult environment for would-be homebuyers to make a purchase.

Here are four things the latest housing market data are telling us about the metro Atlanta market:

Median prices

The median home sale price in the Atlanta area was $400,000 in May, up 3.9% from the same period a year ago, according to Georgia Multiple Listing Services.

But since spring of 2020, the median price has grown by 57% percent.

This Dunwoody home was listed for sale on Thursday, June 26, 2024. In May, median home sales price was about $400,000. J. Scott Trubey/

Credit: J. Scott Trubey

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Credit: J. Scott Trubey

Much of that growth came in 2020, 2021 and 2022 when interest rates were much lower.

Couple these higher sale prices with more expensive mortgages and the market is simply pricing out many people.

Interest rates

In May 2020, the median home sale price was about $254,000 and the average interest rate was 3.15%. If a buyer ponied up 20% as a down payment, the average monthly cost of the mortgage (not including taxes and insurance) was about $873.

For a buyer in May of this year who can put down 20% on the median home of $400,000 with an average interest rate that’s now about 7%, the average monthly cost of a mortgage is now about $2,128 (again, not including taxes and insurance.)

To avoid the high rate, a significant number of buyers pays cash, said Kristen Jones, owner of Re/Max Around Atlanta.

“However, we’re also seeing a steady flow of move-up and first-time buyers who have accepted the reality of higher rates,” she said.


In May, 19,000 homes were for sale in metro Atlanta, according to Georgia Multiple Listing Services. That’s up 60% from a year ago. But even with that increase in inventory, it still only amounts to about 2.6 months’ worth of supply. A more balanced market would be more like 6 months of supply.

One of the culprits of this supply gap is that the nation is not building enough new houses. According to a study released June 18 by Zillow, from 2021 to 2022, the housing shortage nationwide grew from 4.3 million homes to 4.5 million.

In metro Atlanta, Zillow found that in 2022, the region was short nearly 66,000 homes.

With metro Atlanta still suffering from scarce housing, Providence Group is developing a 512-unit  housing project in Cumming that will include townhomes, condos and single-family houses. Courtesy

Credit: cus

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Credit: cus

“The simple fact is there are not enough homes in this country, and that’s pushing homeownership out of reach for too many families,” Orphe Divounguy, senior economist at Zillow, said in a news release. “The affordability crisis extends to renters as well, with nearly half of renter households being cost burdened. Filling the housing shortage is the long-term answer to making housing more affordable. We are in a big hole, and it is going to take more than the status quo to dig ourselves out of it.”

Home building grew nationwide in 2022 and 2023, fueled by the early pandemic surge in buying demand. But the Federal Reserve’s efforts to tamp down on inflation by increasing and keeping high interest rates has had an impact on home purchasing and new home construction.

People with homes who might want to move or buy a newer home currently enjoy much lower interest rates and might not wish to sell and take on a higher cost mortgage. That’s depressed the supply of existing homes listed for sale.

Limits to construction

A building frenzy was a key driver of the financial crisis and Great Recession of 2007 to 2009. In the years that followed, homebuilding in the region was anemic.

Ultimately construction rebounded, but not at the pace the Atlanta region needs, experts say.

New housing developments are happening. But because of high land and labor costs and high interest rates, much of the new product being built is well above the median home sale price.

Restrictive zoning in many communities has also caused prices to go up, experts say.

“I think attainability and affordability — that’s the defining issue of our time,” said John Hunt, principal at MarketNsight, which tracks Southeast housing markets, speaking at the group’s semi-annual conference. “We are starting to see some change and I am very excited about that.”

Removing zoning restrictions against denser development and reducing parking requirements could help address some affordability challenges, the Zillow report said.