The Intown real estate market has remained active, despite higher interest rates. Local real estate professionals report that businesses, investors and new residents continue to be drawn to Intown, resulting in high prices and low inventory, especially for single family homes.
Sarah A. Strohschein
Strohschein, Real Estate Advisor Engel & Völkers Atlanta, said that she is seeing things heat up for the Intown market. “Q1 2024 bounced back from record low activity in Q4 2023. New listings and new pendings increased by roughly 30% in Q1, which helped kick off the spring 2024 market,” she explained.
Strohschein said that the market has been steady with modest home appreciation. Certain property types are more competitive than others, she added, with single family homes being the most competitive.
“Homes in good condition, in desirable Intown neighborhoods and priced appropriately are still selling quickly,” she said. “Generally speaking, these properties are receiving multiple offers, but in the single digits, not the double digit multiple offers we were seeing back when interest rates were lower.”
She reported that mortgage rates moderated from a high of 7.79% in October 2023 to under 7% in March of 2024. “Many buyers on the sidelines continued to pause through Q1 of 2024,” she said, but added that people who’ve been waiting for rates to drop are entering the market.
“They understand the prices of homes in Atlanta only continue to increase and the option of refinancing in a couple years is a good solution,” she said.
Ian Oliver
Oliver, a Realtor with Engel & Völkers Atlanta, said that, in his opinion, the overall Intown market, including condo, townhome and single-family homes, is a bit static
“Since interest rates have not improved, I haven’t really seen a significant uplift in activity, although the Spring selling season has my phone ringing more right now. Year after year this is quite common, regardless of market factors,” he said. “But generally, stubborn interest rates have some buyers sitting on the sidelines.”
The good news, Oliver said, is that Atlanta continues to thrive with job growth and strong job relocations. “Atlanta proudly announced it is now the sixth largest metropolitan area in America! While the growth is metro-wide, there is significant growth in Intown too,” he stated.
Lee Hall
According to Hall, Intown Managing Broker with Ansley Real Estate Christie’s International, higher interest rates have caused some slowing in certain areas Intown, “…especially for first-time homebuyers, but many lenders have great programs to help these buyers,” he said.
The average price in metro Atlanta is up 8% year over year to right at $500,000 for a single family house and $403,000 for a condo, he reported. “For context, just five years ago the average prices were $338,000 and $287,000,” Hall said.
Still, Hall stressed that he is always optimistic about the Intown housing market because it’s such a great, vibrant place to live. “However, the Intown condo market has had some slowing,” he said.
Condo sales hit a snag
Oliver shared that, for condos, the last six months has shown a slight downtick in closed sales volume versus the prior six months, with about 60 average days on market to sell/close versus 50 days on market respectively.
“I largely attribute this to Fannie Mae and Freddie Mac, which recently instituted some changes to their water/flood damage deductible limits for condos,” he said.
The changes resulted in some condos being unable to sell until they adjusted their insurance coverage to meet the new compliance requirements. “It’s taken time for many associations to reach compliance,” Oliver said. “That has slowed condo sales in 2024 certainly, but the dust is settling. There are a lot of great opportunities for buyers out there searching for a condominium!”
Hall noted another issue that potential condo sellers are facing. “Many of the high-rise condo buildings that were completed between 2004 and 2007 are experiencing some normal, but expensive, age-related scheduled maintenance,” he said.
“The average days on market are up to 60, while the months of inventory is 4½, which is a more normal environment,” Hall continued. “If we look at the luxury market, homes sold over $1 million, we still have positive numbers with a 12% increase in inventory, 15% up in sales year over year and days on market averages of 67.”
Looking ahead
Oliver expects the Intown market to remain largely the same. “As long as inflation remains as stubborn as it is and mortgage rates remain high, there isn’t the catalyst we need to spark significant change,” he said.
Strohschein expects inventory will remain at lower than balanced market levels, and more buyers entering the market will keep the market competitive.
“Our population is still growing and for people moving in from states where real estate is much more expensive, Atlanta is very affordable,” Strohschein said. “Investing is also desirable in Atlanta for many in-state and out-of-state investors. I think this will continue to drive up prices.”
If interest rates go down, Hall expects the real estate market to loosen up a little bit. “It’s very hard to part with 3-4% interest rates, so people are staying put to renovate and upgrade. But, from 2023 to 2024, inventory is actually up 37% and sales are up 30%, but pending sales are now down 12%,” he reported.
While that number sounds like a lot, Hall explained it’s because the numbers are actually small. “It doesn’t feel like an uptick,” he said. “And factoring in more people moving to Atlanta, you can see the challenge.”
Hall stated that markets don’t like uncertainty and presidential elections years are usually a little slower. “However, I expect things to remain steady and mostly stable. The days on market might be a little longer, but that’s not an indication of value, just a return to a normalized market,” he said.
