Intown News – Agent Darrell Ford

Market Update: What To Expect This Fall

In my opinion, the most crucial piece of news since my last update was the Fed’s dovish tone following their Jackson Hole meeting. There is a high probability for a September rate cut, which should start providing relief on mortgage rates in the fall, assuming the 10-year yield responds favorably. Currently, a 30-year fixed sits around 6.5%. Banks are forecasting rates as low as 6% in the fall on the 30-year fixed.

With record inventories and falling rates, I expect that the fall will be more active than in the past several years, as there is significant pent-up demand.

Below is my update on the current residential real estate metrics nationally and locally, along with a summary of what Atlanta buyers and sellers can expect in the fall.

National Market Analysis [JULY]

Median home price: $422,400, up 15.7% from a year ago

Days on the market: 28 days, up from 24 days a year ago

Supply: 4.6 months, up from 4 months a year ago

Buyers & Region

First-time buyers account for 28% of national sales, and second-home buyers were responsible for 20% of sales.

Home sales in the country’s southern region are up 2.2% from the same period last year, and the median home price in May was $367,400.

Atlanta Market Analysis [JULY]

Median home price: $437,250, up 1% from a year ago

Days on the market: 41 days, up 36.7% from a year ago

Supply: 4.7 months, up 34% from a year ago

Sales: down 4.1% from a year ago

Atlanta market overview

As you can see from above, there is now a significant supply in the Atlanta metro market. This should keep prices subdued during the fall as buyers have many options. However, I expect to see some growth due to Atlanta’s strong job market and population influx.

Fall 2025 is likely to see continued balancing, with economic factors like business confidence and stability playing key roles. Overall, forecasts indicate flat to modest price changes, higher supply, and increasing sales activity.

For Buyers: This fall is expected to be favorable for buyers, with an abundance of inventory providing negotiating leverage, potential price dips, and more concessions from sellers (e.g., nearly two-thirds offering incentives).

There are many excellent homes for sale in some of the best neighborhoods right now. Below are three examples of homes that are perfect for first-time buyers:

For Sellers: Increased competition from rising inventory could potentially extend time on market and pressure prices downward. Therefore, it will be essential to work with a Realtor like me to optimize pricing and provide guidance on highlighting desirable features. However, there is still extremely strong demand in luxury condos located in desirable neighborhoods, with more motivated buyers entering as rates stabilize.

Conclusion

Atlanta remains one of the best markets in the country for real estate. Both buyers and sellers can expect activity to pick up this fall if mortgage rates begin to decline and prices stabilize. Overall, this fall will most likely be the optimal time to buy or sell your home this year.

If you’re ready to buy or sell a home this fall, don’t hesitate to contact me.

Mid Summer Market Update

Since my last update, markets remained stable and neutral for both buyers and sellers. We have not made any significant headway with rates. However, inventories continue to increase, paving the way for more affordable prices nationwide.

In some ways, we are in a pressure cooker, waiting to see if rates or prices will be the first to give, and once one of them does, we will likely see a significant increase in activity. But as of now, we are still in a holding pattern.

Nevertheless, Intown Atlanta remains in high demand, and there are great opportunities if you know where to look. I list some of those opportunities below, along with the latest national and local residential real estate metrics.

National Market Analysis [May]

Median home price: $422,800, up 1.3% from a year ago

Days on the market: 27 days, down from 29 in April

Supply: 4.6 months, up from 4.4 months in April

Buyers & Region

First-time buyers account for 30% of national sales, and second-home buyers were responsible for 17% of sales in May.

Home sales in the country’s southern region are down .5% from the same period last year, and the median home price in May was $367,800.

Atlanta Market Analysis [June]

Median home price: $420,000, down 1.2% from a year ago

Days on the market: 40 days, flat since May

Supply: 5.2 months, up from 4.7 months in May and up 49% from a year ago

Sales: down 11.5% from a year ago

Atlanta market overview

As we start the third quarter and the summer selling season, I expect the market to remain stable. With inventories at higher than average levels, there should be equal opportunities for both buyers and sellers. I expect mortgage rates to remain within the 6-7% range over the next three months, so that affordability will depend more on price than on rate changes. Below is a quick summary of what buyers and sellers can expect.

For Buyers: The increased inventory is expected to help bring balance to negotiations and lead to more favorable outcomes. More than half of the sales in June closed below the listing price. These price concessions can help buyers offset the higher rates. If you know where to look, you can find some excellent opportunities in great intown neighborhoods. Below are my top four listings for intown options:

For Sellers: Homes in desirable intown neighborhoods can still get premium pricing if positioned and priced correctly. Overpricing could lead to a home sitting on the market for extended periods, as buyers have many options and negotiating power. It will be critical for sellers to work with a realtor like me to price and market the property effectively, optimizing its value and minimizing the time it spends on the market.

Conclusion

Atlanta sits in a balanced market for both buyers and sellers. With inventories at a 5-year high, buyers have excellent options and negotiating power. Intown Atlanta remains in high demand, and sellers can still expect to receive the asking price if they are priced and marketed correctly. The overall market should pick up once either rates or prices give, and Atlanta is one of the best real estate markets in the country once the movement happens.

If you’re ready to buy or sell a home this summer, don’t hesitate to contact me.

Atlanta Real Estate Market Outlook for the Second Half of 2024

In the latter half of 2024, the Atlanta real estate market presents a unique landscape for buyers and sellers. With recent shifts in mortgage rates and economic indicators, I want to provide an overview of the Atlanta market dynamics and opportunities in the back half of this year so you can make informed decisions when buying or selling a home.

Interest Rate Trends and Their Impact

As I have discussed in recent blog posts, the Federal Reserve’s “higher for longer” interest rate policy has dominated much of 2024, leading to fluctuating mortgage rates that have kept buyers and sellers on the sidelines.

However, a recent dip in rates, the lowest since April 2023, has brought renewed optimism to the market. The national average for the 30-year fix is hovering around 6.5%. This reduction in mortgage rates has significantly improved affordability, giving buyers greater purchasing power. According to a recent Redfin report, buyers have gained nearly $30,000 in purchasing power over the past month due to these lower rates, making it a more favorable time to enter the market.

What Buyers Can Expect

Increased Purchasing Power:

The drop in mortgage rates means buyers can afford more expensive homes without increasing monthly payments. For instance, according to the Redfin report, the monthly mortgage payment on the median-priced U.S. home, which goes for roughly $443,000, is $2,842 with today’s average mortgage rate. Just one month ago, the payment would have been $3,032, nearly $200 more. This increase in affordability allows buyers to explore a broader range of properties, potentially in more desirable neighborhoods.

Strategic Timing:

Acting sooner rather than later could be advantageous for those considering a home purchase. As mortgage rates stabilize or potentially decrease further, competition among buyers is expected to intensify, which could drive up home prices. Buyers may avoid the rush by entering the market now and secure better deals before demand peaks.

Negotiation Leverage:

With more homes likely to come onto the market due to improved seller confidence, buyers may have more options. This increase in inventory can give buyers greater leverage during negotiations, particularly on properties that have been listed for an extended period.

What Sellers Can Expect

Potential Price Pressure:

The increase in buyer affordability could lead to a surge in demand, particularly for well-priced homes in desirable Atlanta neighborhoods. Sellers who list their homes in the coming months, especially before the anticipated September rate cut, may benefit from quicker sales and, in some cases, multiple offers.

Capitalizing on Demand:

Sellers should consider listing their homes soon to take full advantage of the current market conditions. With buyers gaining purchasing power, there is a window of opportunity for sellers to achieve favorable sale prices, particularly if their property is move-in ready and competitively priced.

Preparing for a Competitive Market:

As more sellers may decide to list their properties due to improving market conditions, ensuring that a home is in excellent condition will be critical. Professional staging, minor renovations, and strategic pricing will be essential in attracting buyers and standing out in what could become a more crowded market.

Conclusion: Strategic Moves for Buyers and Sellers

The second half of 2024 is poised to be a dynamic period for the Atlanta real estate market. Buyers now have an opportunity to capitalize on increased affordability due to lower mortgage rates, while sellers can benefit from the growing demand. Both groups should stay informed about ongoing economic and market trends to make the most strategic decisions. For buyers, this might mean locking in a favorable mortgage rate soon, while sellers may want to list their properties soon to take advantage of the current market momentum.

It will be essential to work with a seasoned Realtor like myself who understands these trends and can help you find opportunities and prepare accordingly.

If you are ready to buy or sell a home in Atlanta in the coming months, please do not hesitate to contact me.

July 2023: Quarterly Market Update

Over the last few months, mortgage rates have remained steady, with the FED pausing rate increases in the immediate term.

Nevertheless, the FED has hinted at the possibility of resuming rate hikes during the back half of the year.

As I mentioned in last month’s newsletter, I believe that home prices will gradually tick up through the summer. Therefore, with some current stability, buying sooner rather than later this summer could be a wise purchasing decision. Likewise, you can avoid a potentially higher mortgage rate in the later months of the year if rate hikes resume.

As you will see from the analysis below, buyers are already starting to step back in to take advantage of some of the current prices and rates.

Below I outline the most recent data from a national and local market perspective.

April 2023: Quarterly Market Update

Given the recent tapering down of FED rate hikes this month, I expect to see mortgage rates stabilize in the back half of the year. This stabilization should improve buyer confidence. Nevertheless, homebuyers are consistently stepping in and buying at any rate decreases. As the year progresses, I view pent-up demand as a good sign for the Atlanta market.

January 2023: Quarterly Market Update

With the continued FED rate and subsequent mortgage rate increases, it’s logical that the real estate market demand has cooled. However, because of the supply constraints over the last three years, the waning demand has not significantly affected prices here in Atlanta. I view this as a positive for our real estate market in the medium term.

October 2022: Quarter Market Update

With such aggressive rate increases from the FED, you would expect a relatively substantial decline in home prices. However, due to the ongoing supply issues, elevated home prices have been resilient, with only moderate declines in specific markets. We seem to be at a curious standstill in the housing market where prices, buyers, builders, and sellers are not budging.

I don’t foresee any significant changes in the urban Atlanta market in the near term. Demand still exists, and there is not enough supply. However, as I wrote about last month, I am starting to see some better opportunities for astute buyers.

Atlanta Residential Real Estate Outlook 2022

Despite much of the uncertainty over the last two years, the Atlanta real estate market has been highly resilient and remains one of the top markets in the country.

Because of the extraordinary performance, I am frequently asked whether or not we can expect this resilience and performance in 2022.

2020 in Review and 2021 Expectations

Happy New Year!

As we close out the year, I want to provide an overview of the 2020 residential real estate market and provide my thoughts on 2021.

This past year was a big year for residential real estate with strong price growth and new home trends.

2020 Growth

Home sales saw tremendous growth this year as consumers took advantage of low-interest rates. Likewise, being forced to spend more time at home, the desire to have one’s space increased.

This growth was reflected both at a national level and in Atlanta.

From January through November 2020, home prices grew 19% nationally, compared to 5% in 2019.

In Atlanta, 2020, home prices rose 18% compared to 7% in 2019. This growth was impressive, given that we were already in a hot market.

Fewer people were selling, too, driving down supply. National supply in November 2020 was at 1.6 months compared to 3.1 months in November 2019.

In Atlanta, November 2020 supply was also at 1.6 months compared to 2.9 months in November 2019.

This shortage was reflected in how quickly homes were selling. Nationally, homes remained on the market for an average of 11 days in November, compared to 27 days in November 2019.

Atlanta was no different; homes remained on the market for 11 days in November, compared to 26 days in November 2019.

2020 Trends

2020 changed the way people shopped for homes and changed the priorities of what people looked for in homes.

Online home shopping accelerated as people toured homes virtually. Video conferencing was prioritized as agents walked clients through homes on video calls. As I have adapted to the changing markets, I now have the technology to provide even better services for clients hesitant to leave their homes.

Another significant shift has been in the way we close, becoming more virtual with remote mortgage approval, inspections, and appraisals.

Priorities also shifted. More people considered homes with dedicated office space, good outdoor access, and home gym or community gym access. This changed the way sellers prepared, staged, and listed their homes to sell.

Looking ahead to 2021

Due to low mortgage rates, we will continue to see a strong buyers market. Rates are forecasted to stay between 2.9%-3.4% for 2021. In the near term (Q1 2021), I expect 30 year fixed to remain around 2.7%.

With limited supply and high demand, I expect home prices to continue to rise over 2021, but not at the rate of 2020. Experts predict that more inventory will become available in the summer months as vaccines take hold and warm weather ensues.

I expect the same trends to continue to manifest in 2021. Buyers will be looking for more space. National Homebuilders Association expects an increase in median home size after a four year decline.

Demand for green space and more defined floor plans will take hold as more people spend time in their homes with activities like working and exercising.

Overall I believe we will have another bullish year for home sales. It will be a good year for both buyers and sellers and a year to take advantage of low-interest rates.

Are you ready to buy or sell your home in 2021? Contact me, and I can walk you through everything you need to know to make a smart long-term decision.

Quarterly Update: Q3 2020

We’re transitioning into fall with a robust residential real estate environment.

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