Atlanta Housing Dips Slightly in February
Despite having an extra day to capitalize on productivity in February, the Atlanta housing market dipped slightly last month due to declines in home sales and housing confidence, though inventory levels and home prices have shown improvements. As a result, the Cal-Culator, Atlanta’s residential real estate index, dropped marginally from 7.0 to 6.9.
The National Association of Realtors reported its Pending Home Sales Index dropped 2.5 percent in January following the highest average year for the index in nearly a decade. The PHSI rose a modest 1.4 percent from last year – the second smallest year-over-year increase since September 2014. Single-family home sales also decreased by 9.2 percent below the December rate and 5.2 percent below January 2015.
“While January’s blizzard possibly caused some of the pullback in the Northeast, the recent acceleration in home prices and minimal inventory throughout the country appears to be the primary obstacle holding back would-be buyers,” said NAR Chief Economist Lawrence Yun. “Additionally, some buyers could be waiting for a hike in listings come springtime.”
Housing Market Index
National Association of Home Builders’ Housing Market Index, a monthly survey of NAHB members designed to take a pulse of the single-family housing market, declined nationally and in the South in February. The index declined from 61 (out of 100) to 58 nationally and from 60 to 57 in the South. Any number above 50, however, is considered to represent a “good market.”
A positive spot of the month was the slight increase in home prices. CoreLogic found prices increased 1.3 percent over the previous month and a respectable 6.9 percent over the previous year. Georgia home prices increased 0.5 percent month-over-month and 5.8 percent yearly. The company also predicted home prices will reach a new peak level in May.
Inventory continues to plague the nation, but Georgia has recently been making progress toward recovery. According to the Atlanta Board of Relators, inventory in Atlanta dropped 3.8 percent from January 2015, but rose an astounding 40 percent from December. Unfortunately, the supply level is at 3.1 – barely half of what is considered the ideal supply level.
“January was a signifier of the healthy home sales and prices that we are predicting in 2016. The housing momentum from December has continued into January and we are showing signs of entering an early spring. Inventory is still a concern and is continuing to be one of the major hindrances to the overall market,” said ABR President Lane McCormack.
Check back April 12 as we review if 2016 is beginning to mirror 2015’s stellar growth in the Atlanta housing industry.