After an usually “hot” winter in Atlanta real estate, the Atlanta housing industry appears to have adjusted with outdoor temperatures and has cooled off – for now. Last month’s Cal-Culator hit a record 6.0, where it will stay for another month. Although sales of homes and home prices increased as did inventory, sluggish pending home sales and decreased home construction due to crippling winter weather were factors that kept the index the same.
The U.S. Department of Commerce released its U.S. Census Bureau News for January, which showed that sales of new single-family homes rose 9.6 percent from December and 2.2 percent year-over-year.
Home prices increased by 12 percent year-over-year in January, marking the 23rd consecutive month of year-over-year home price gains, according to CoreLogic. Prices increased by 0.9 percent in January compared to December data.
“The last time January month-over-month and year-over-year price appreciation was this strong was at the height of the housing bubble in 2006,” said CoreLogic Chief Economist Dr. Mark Fleming.
Zillow’s January Real Estate Marketing Reports found the number of homes listed for sale on Zillow was up 11.1 percent nationwide from the year prior, making January the fifth straight month of rising year-over-year inventory. Atlanta experienced a 10.7 percent increase in inventory from the previous year in January.
The U.S. Department of Commerce also indicated that the housing crunch is slowly beginning to ease. The department found that the U.S. now holds a 4.7-month supply of homes, though a 6-month supply of homes is recommended.
Unfortunately, the housing industry is not exempt from external factors. Just as the industry was negatively affected by the government shutdown last fall, it has also suffered from recent extreme winter weather. Though home sales rose, pending home sales remained unchanged, according to the National Association of Realtors, partly due to the weather.
“Ongoing disruptive weather patterns in much of the U.S. inhibited home shopping,” said Lawrence Yun, NAR chief economist. “Limited inventory is also playing a role … while credit remains tight and affordability isn’t as favorable as it was a year ago.”
U.S. home construction fell in January for the second consecutive month, down 16 percent from December, according to the U.S. Department of Commerce. Construction had increased every month in 2013 before severe winter weather struck the nation beginning in December. Applications for building permits also fell in January by 5.4 percent, according to the report.
Even Zillow reported that mortgage rates had declined for the first time in four weeks, during the last week of February, to 4.11 percent due to global unrest.
“Rates drifted downwards last week as geopolitical concerns emerged from the turmoil in Ukraine,” said Erin Lantz, director of mortgages at Zillow.
The next Cal-Culator will be released April 8 and will hopefully chart positive growth in the industry without severe weather or global chaos inhibiting growth.