Atlanta’s population growth contributing factor to housing stock crisis
Writer: Mirella Franzese
August 2024 — A shortage of housing stock in Atlanta means the suburban market is currently outpacing the Metropolitan core, which marks a clear shift from the seller-based economy of previous years to a more buyer-dominated one.
“We need more homes, and until we get them, we’re not going to be able to correct the market,” said John Pitre, a local realtor with over 15 years of experience, as cited by Atlanta News First.
Available home listings in Atlanta for the month of July was 7,761, the highest it has been in over two years. Despite positive growth, the total number of homes for sale still greatly exceeds the number of new residents moving to the Metro area, which was recorded at 63,000 between April 2023 and 2024—reflecting a 2.1% growth from the previous year.
While the population of the region is growing, a study by Florida Atlantic University and Florida International University released in May found that Atlanta is the second most overpriced housing market in the United States, losing only to Detroit in that category after having topped the charts for over a year.
According to the report, the average price for buying a home in the Atlanta area is 40.4% above the expected market value— a premium rate which grew steadily since February 2023 after peaking at 44.19% in July 2022. The median price for homes sold in July of this year was $422,972. FAU Housing economist Ken H. Johnson credits the overvaluation of the regional housing market to population growth, which is placing a strain on supply and driving up prices as a result.
“The demand for housing is insatiable,” explained Patrick Kassin, a development partner at Woodfield Development in an interview with Invest:. “However, we are cognizant of the challenges posed by rising construction costs and interest rates, which have slowed the pipeline for new housing.”
An analysis from the U.S. Census Bureau reported significant housing stock changes over a ten-year period (2012-2022) for suburban areas in Atlanta, most of which doubled in size. Chamblee, Braselton, Holly Springs, and Clarkston were among the leaders in this ranking.
“We’ve had an explosive couple of years,” Henry County Manager Cheri Hobson-Matthews told Invest:. “The last couple of years have probably seen the largest number of multifamily units that have been approved by our board because there’s such demand for that component.”
[fusion_images order_by=”desc” picture_size=”auto” hover_type=”none” autoplay=”yes” autoplay_speed=”3000″ flex_align_items=”center” columns=”1″ column_spacing=”0″ scroll_items=”” show_nav=”yes” mouse_scroll=”no” border=”no” lightbox=”no” margin_top=”” margin_right=”” margin_bottom=”” margin_left=”” hide_on_mobile=”small-visibility,medium-visibility,large-visibility” class=”” id=”” caption_style=”off” caption_title_tag=”2″ fusion_font_family_caption_title_font=”” fusion_font_variant_caption_title_font=”” caption_title_size=”” caption_title_line_height=”” caption_title_letter_spacing=”” caption_title_transform=”” caption_title_color=”” hue=”” saturation=”” lightness=”” alpha=”” caption_background_color=”” fusion_font_family_caption_text_font=”” fusion_font_variant_caption_text_font=”” caption_text_size=”” caption_text_line_height=”” caption_text_letter_spacing=”” caption_text_transform=”” caption_text_color=”” caption_border_color=”” caption_overlay_color=”” caption_align_medium=”none” caption_align_small=”none” caption_align=”none” caption_margin_top=”” caption_margin_right=”” caption_margin_bottom=”” caption_margin_left=”” parent_dynamic_content=””] [fusion_image image=”https://capitalanalyticsassociates.com/wp-content/uploads/2024/07/CAA24_Invest-Insights-S6-Web-Banners-7.jpg” image_id=”64377″ image_title=”” image_caption=”” link=”” linktarget=”_self” alt=”” /] [fusion_image image=”https://capitalanalyticsassociates.com/wp-content/uploads/2024/07/CAA24_Invest-Insights-S6-Web-Banners-10.jpg” image_id=”64380″ image_title=”” image_caption=”” link=”” linktarget=”_self” alt=”” /] [fusion_image image=”https://capitalanalyticsassociates.com/wp-content/uploads/2024/07/CAA24_Invest-Insights-S6-Web-Banners-9.jpg” image_id=”64379″ image_title=”” image_caption=”” link=”” linktarget=”_self” alt=”” /] [fusion_image image=”https://capitalanalyticsassociates.com/wp-content/uploads/2024/07/CAA24_Invest-Insights-S6-Web-Banners-8.jpg” image_id=”64378″ image_title=”” image_caption=”” link=”” linktarget=”_self” alt=”” /] [/fusion_images]
Despite the growth, the relocation trend outside of Atlanta has also continued. From May to July of 2024, 21% of residents were looking to purchase homes outside of the Atlanta area. Macon, Chattanooga, TN, and Savannah were the top choices for those Atlantans searching for homes outside of the region.
The housing outlook for the rest of the year is positive. Last week, the Atlanta Housing Board authorized $105 million in financing to develop 903 new affordable housing units across the city to alleviate the growing need for economical homes. While property values continued to rise from Q1 through to Q2, according to the Georgia Realtors (GAR) June 2024 Housing Indicators, the number of new listings on the market increased by 18% to 101,223, suggesting a cooling period in the near-term.
