The Atlanta Housing Market Deep Dive from Your Mortgage Lenders in Georgia

As mortgage rates in Georgia are poised to drop later this year, buyers and sellers alike are anxious about what the housing market in and around Atlanta will look like in the coming months. 

Whether you’re a first-time home buyer or an experienced one, buying and selling in Atlanta requires research, a good team of professionals, and patience. We’re here to help you with the first two. For patience, consider meditation.

Mortgage lenders in Georgia are seeing the housing market slowly open up, as buyers and sellers wait for the Fed to lower rates. 

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Facts & Figures

  • 66,730 new Atlanta-area residents between 4/1/22 and 4/1/23
  • 36,074 new housing permits in the same period
  • Residential sales up 3% over 2023
  • Average price up 9% over 2023
  • New listings up 7% over 2023
  • Total Inventory 10,380 in January
  • Average sale price $481,500
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Crowded Market

Atlanta has experienced explosive growth, year-over-year, for nearly a decade, 

The Atlanta Metro-Region grew by more than 60,000 residents from 2022 to 2023 and has continued to grow in the meantime. That’s compared to 36,074 new housing permits over a similar period. 

The lopsided permit-to-growth ratio created competition in the housing market, which has fizzled with higher rates. But population and availability trends have held, so competition will return in the form of inflated prices when rates drop, especially since Atlanta already struggles with affordable housing availability.

And the growth shows no signs of stopping, meaning that demand will likely outpace supply for months and years to come. 

Realtors and mortgage lenders in Georgia and nationwide selected Atlanta as one of the hottest housing markets this year.

“That residential building boom in the city of Atlanta translates into the biggest single-year population growth that we’ve seen in the city of Atlanta at least for the past two decades,” according to an Axios interview with Mike Carnathan, managing director of research & analytics at the Atlanta Regional Commission.

The commission expects the immediate metro area to grow by nearly 1.5 million residents and the larger 21-county region to grow by almost 2 million by 2050. 

What Goes Into Affordability?

Housing affordability, like with most things, comes down to supply and demand. When buyers have more options than sellers, they hold the negotiating power, and prices tend to go down. When sellers have multiple offers, they’re the ones with the power, and prices go up. 

Since mortgage rates are still high, many buyers are waiting to purchase, stalling the market. But with a growing metro area like Atlanta, the housing market is never truly stagnant.

Many sellers, anticipating a decrease in interest rates, are preparing to list their homes, increasing availability.  

That means buyers have a tough decision to make in the current market.

  • Do I sacrifice higher interest rates for lower prices and less competition?
  • Do I risk higher prices and competition for a better interest rate? 
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New Listings Up 

“Buyers must seize current opportunities amidst evolving market conditions. Waiting for lower rates may invite heightened competition, potentially offsetting future savings.”

Atlanta REALTORS® Association President Kelly Guin Thrash

Even with high rates, a good number of new units are hitting the market, and prices are continuing to climb slowly. 

According to the Atlanta REALTORS® January Marketing Brief, residential sales were up nearly 3% last year, and the average price was up more than 9% over the same time. New listings rose 7% over January 2023 and 61% over December. 

“December revealed a familiar decline in sales, attributed to various factors, including the impact of higher interest rates,” said Atlanta REALTORS® Association President Kelly Guin Thrash. “However, the dawn of January paints a different picture with a notable surge in activity, sparking optimism for the months ahead. Though sales experienced a downturn, subtle price increases offer a glimmer of hope for a more stable growth trajectory in 2024. Yet, as inventory tightens and buyer hesitancy persists, challenges loom despite potential rate cuts on the horizon. In response, it’s crucial for both sellers and buyers to recalibrate their expectations. Sellers should adopt objective pricing strategies and brace for longer listing periods, while buyers must seize current opportunities amidst evolving market conditions. Waiting for lower rates may invite heightened competition, potentially offsetting future savings.”

For all the talk about a stagnant market and high interest rates, the market is already recovering without help from the Fed. 

New Builds are on the rise in 2023

If you’re not ready to enter the market yet or feel a need to wait on lower mortgage rates in Georgia, there is still good news. 

The Atlanta area has seen an increase in new homebuilding units, both single-family and multi-family. In May 2023, Atlanta approved 74 new permits per 100,000 residents, compared with the nationwide average of 43 new permits per 100,000 residents. 

“I think that we all aspire for Atlanta to be an inclusive place that’s approachable and accessible to everyone,” said Joshua Humphries, CEO of the Federal Reserve Bank of Atlanta. “If we don’t have the variety of housing that we need to have… I think we’ll fail to be the best version of ourselves in the city.”

More housing availability means more affordable housing. This even applies to multi-family units. 

Rental Markets Impact Home Sales

When rent prices are high, people who would typically rent may begin to crowd the buyer’s market. Conversely, when rental vacancies increase, property owners consider listing their properties for sale, creating more supply in the buyer’s market. 

Rental vacancies in Atlanta are actually high right now, up nearly 2% over last year and well over the national average. 

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Buy Now and Refinance

Because the market will open up when the Fed lowers interest rates, we can confidently say that pent-up demand and decreasing borrowing costs will drive home prices up. 

While home values in Atlanta have fallen in proportion to mortgage rates since the highs of 2022, those drops in value have flattened out and should begin to rise again before the end of the year.

Higher interest rates are certainly a concern when committing to a long-term loan, but they aren’t necessarily any more costly than a bidding war in a tight housing market. 

Plus, you can refinance a loan when rates drop, but you can’t rebuy your house at a lower price. 

This isn’t the right option for everyone, but if you want to move soon, have your eye on a property, or don’t feel like competing for a house, buying now may be a smart move. 

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Buying or Waiting, Get a Head Start Today with Mortgage Lenders in Georgia

Whether you’re ready to dip your toe into the market or you’ve decided to wait until mortgage rates drop later this year, it’s never too early to get your paperwork in order. 

The pre-approval process is nearly identical for most mortgage lenders in Georgia, requiring income verification, credit history, asset statements, and any information about outstanding debt. 

Preparing those documents will give you a head start, and receiving a pre-approval will give you negotiating power for 60-90 days. However, a pre-approval is more about intent than anything; the true approval process doesn’t begin until after your offer is accepted.

Some mortgage lenders in Georgia, like the Moreira team, offer an Upfront Approval Guarantee. With this approval, you’ll be more than “pre-approved.” The underwriter will fund the loan before you ever submit an offer. 

The Upfront Approval Guarantee is good for 120 days. That’s a four-month head start on everyone else as the market opens up. Find out what you need to get approved today.