The shortest month of the year saw a mix of positive and negative factors in the Atlanta residential real estate market; however, being focused on pockets of the consumer segment can return a 60% growth year over year as experienced at Southeast Mortgage in February.
The Cal-Culator, Atlanta’s leading residential real estate index, will hold steady at 6.3 for another month due to a continued decline in mortgage delinquency rates and a long awaited increase in inventory offset by declining home sales and investment in the Atlanta market.
Let’s Start With the Bad
Investors’ Dollars in Atlanta & Home Sales: The Atlanta Business Chronicle reported that home sales in metro Atlanta fell 37 percent from December 2014 to January 2015 and were also down 9.7 percent year over year. The decline was attributed to investors buying fewer homes in the area.
Substantial Decline in First-time Homebuyers: The National Association of Realtors also released data that nationwide, existing-home sales fell 4.9 percent to the lowest rate in nine months. First-time homebuyers, a vital demographic in the housing industry, declined to 28 percent, the lowest rate since June 2014. According to NAR Chief Economist Lawrence Yun, “January housing data can be volatile because of seasonal influences.”
Now for the Good News
Inventory: According to the latest data from the Atlanta Board of Realtors’ latest Market Brief, Atlanta housing inventory increased 13.6 percent year-over-year and by a staggering 54 percent from the previous month. Last year’s local real estate industry was tainted by the Atlanta housing crunch, which seems to be easing thus far in 2015.
Mortgages: For the 12th straight quarter, mortgage delinquency rates (defined as the rate of borrowers who are 60 days or more late on their mortgages) declined, according to TransUnion’s latest mortgage report. The vice president of research and consulting at TransUnion noted that the mortgage delinquency rate “continues to be well controlled as it slowly recedes to pre-recession levels.”
It’s no surprise that the short month combined with multiple threats of snow around Georgia didn’t propel the real estate market as far as hoped. However, housing experts are still extremely optimistic about the remainder of 2015 and are not overly concerned with this brief bout of sluggishness.
“Low interest rates, rising sale prices, economic expansion and balanced inventory support my expectation that the market will continue its strong and steady growth,” said Atlanta Board of Realtors President Ennis Antoine. “I believe the dynamic economic recovery we are seeing is going to have a major impact on the 2015 Atlanta housing market.”
The next Cal-Culator will be released March 7. Stay tuned to see if next month will reflect a positive come back after a month of stagnation.