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Today's AJC Article On Interest Rates
October 11th, 2023 12:11 PM
Today's Article In The AJC:  Atlanta's real estate market continues to cool due to high interest rates.  

Interest rates weighing on home sales
Metro Atlanta market ‘has really pulled back,’ real estate service says.
By Michael E. Kanell -
The metro Atlanta housing market stumbled in September under the weight of the highest mortgage rates since 2000.
In the 12 counties centered on the city of Atlanta, there were 4,488 homes sold last month, down 16.7% from August and a drop of 21.8% from the same month a year earlier, according to the Georgia Multiple Listing Service.
“There has been a fairly significant drop-off from last year,”
John Ryan, chief marketing officer for Georgia MLS. “And now we are going into the usual seasonal decline.”
The total value of homes sold last month was $2.1 billion, a drop of 18.1% from a year ago. That means much less money for many people whose business depends on sales: brokers, lenders, appraisers, accountants and attorneys.
“We’ve seen a decrease in the number of appraisers,” Ryan said. “I think that is a sign that the market has really pulled back.”
The latest chill came as mortgage rates climbed again, he said. “I think 7% has been a demarcation line.”
Rates had crested above 7% last fall but have been
below that line from last November to mid-August.
The average 30-year mortgage rate last week was nearly 7.5%, the highest it has been since late 2000, according to Freddie Mac, which buys mortgages in the secondary market.
A year ago, the average rate was 6.6%. Two years ago, it was 2.99%.
Higher rates are a problem for homebuyers. As rates rise, they add to the amount due monthly for the same loan, effectively cutting the purchasing power of buyers. Faced with higher rates, some potential buyers lower their sights and search for less costly homes, while others stay put, hoping rates will drop.
But higher rates have also been a sticking point for owners who might sell.
Most current owners bought their homes when rates were much lower and would be trading them for higher rates if they move.
The result has been a small pool of inventory — that is, the listing of homes for sale.
In September, that pool was 10.2% smaller than it was a year ago, when it was already considered inadequate.
In a balanced market, experts say that supply should be roughly equal to six or seven months of sales, but listings now represent a little more than two months of sales.
And that has meant that wannabe buyers still confront a market that is tilted to the advantage of sellers.
“Despite rising mortgage rates, there are still many buyers out there actively looking,” said broker Kristen Jones, owner of Re/Max Around Atlanta. “We continue to see multiple-offer situations on many properties.”
So, while the overall chill in the market means prices aren’t climbing the way they were a year ago, the tilt toward sellers keeps prices from dropping. The median sales price for a home in the core 12-county area last month was $395,000, up 2.3% from a year earlier, according to Georgia MLS.
16.7% The decrease in number of metro Atlanta home sales from August to September.
7.5% Average 30- year mortgage rate last week, highest since November 2000. Rates have continued to inch up this week.
$395,000 Median sales price for a metro Atlanta resale in September, up 2.3% from a year ago because of limited inventory on the market.

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Posted by Cameron Horne on October 11th, 2023 12:11 PMPost a Comment

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