Here are my predictions for where our market is heading over the next few months. Keep in mind, I’ve been 100% entrenched in Atlanta real estate for nearly 20 years, and to toot my own horn, I’ve consistently nailed it on the head when it comes to predicting where we’re trending. This is because I actually work in the industry and analyze real data. Most economists and news correspondents that attempt to tell you where the market is heading have never sold a single home in their life and generalize the data. The Atlanta market is completely different from other markets, so you can’t lump different cities and states together.
The good news is the market doesn’t suck right now! Most people think it does because interest rates are “high” (6% isn’t all that bad; we just got used to 2.85%). Here’s the reality right now—inventory is still ridiculously low. To give you an example, in all of Woodstock there are only 188 homes listed for sale in FMLS. Roswell, 131 homes, and Marietta, only 486 homes. Out of these listings, about 20% aren’t even built yet! As I write this in December, inventory is still declining. Need I also remind you that Metro Atlanta’s population has soared this year to over 6.1 million people.
Here’s my predictions for the next several months. Inventory will stay low. Most sellers don’t want to list because they love their current interest rate. We’re likely going to be pushing back into a seller’s market, regardless of what interest rates are doing. If you choke out supply like what’s happening now, people will still be willing to pay at or above market value for good homes. Case in point, our most recently listed homes in the last 30 days have still generated multiple offers because we staged and priced them correctly.
You might be asking, why aren’t we in a feeding frenzy right now if inventory is so low? Most buyers are still shocked by the reckless rate hikes. It’s all about perception, which takes time to shift. Hell, I bought my first home in 2001 with a 6.75% rate and thought I ripped off the bank! At the time, rates were close to 8%, so I jumped on that “bargain” when rates dropped below 7%. In the 1980’s, rates were 16%, home values still appreciated, and buyers still bought!
That said, once buyers’ expectations have reset to the new normal, they will re-enter the market. So if you’re thinking of buying, do it now and capitalize on the upcoming appreciation. If you wait until rates drop, you’ll be competing with increased buyer demand yet again. It’s likely we won’t see crazy bidding wars unless it’s a prime home at a great list price. (Although if inventory drops even more, it could happen.) For Atlanta, on top of the rapidly increasing population, high rental rates have driven buyers to “eat” a higher interest rate and become homeowners (very smart move, by the way).
So there you have it! Buy as much real estate as you can now and hold onto it! You’ll thank me 15 years from now, I promise!