By Bill Adams, Founder, Adams Realtors & Adams Commercial Real Estate
Welcome to the January 2023 Residential Intown Atlanta market report which is our only monthly report that compares calendar years. Our other monthly surveys are based on the last 12 months or a trailing 12-month model. Thus, the reports for the other months contain data from parts of four years. The January 2023 report covers the years 2020, 2021 and 2022. This report shows the annual growth in Average Sales Price, the trend of properties staying on the market for less time and the shrinkage in the number of transactions over the past three years.
For 2022, the Average Sales Price for the overall residential Atlanta market is $689,441. This is an 11% increase over 2021’s Average Sales Price of $623,628 and a 29% increase over 2020’s Average Sales Price of $532,701.
In another reflection of the overheated real estate market, the Average Number of Days on the Market fell from 42 days in 2020 to 30 days in 2021 to 28 days in 2022. The limited supply of houses for sale and a possible lessening of demand saw the number of transactions fall from 2,639 units in year 2020 to 2,450 units in year 2021 to 2,015 units in year 2022. This is a decrease in transactions of 24% from 2020 to 2022 and a decrease of 18% over the last year. In 2022, 415 fewer units were sold than in 2021 and 624 fewer units were sold than in 2020.
So, what is ahead for 2023? I am somewhat surprised that the Average Sales Price for the market continues to increase at a healthy rate. I would have thought, given the sharp increase in mortgage rates beginning around mid-year 2022, that the percentage increase would be in single digits. I expect that at some point over the next few months, the rate of increase will drop below 10%. I do not expect the overall market to experience a decrease in Average Sales Price though.
As you can see in this month’s report, only one neighborhood – Cabbagetown at -1% – saw a decrease in year-over-year Average Sales Price. I expect that the Number of Days on the Market may drift upwards from 28 days. I don’t anticipate much of an increase in the supply of single-family homes in the market. When mortgage interest rates begin to drop, I expect demand will pick up, and that homeowners who have been sitting on the sidelines may see the lower rates as an opportunity to sell their homes, which will increase the supply of homes for sale. My guess is that the rate of inflation will continue to gradually fall during the year and bring mortgage interest rates down with it. Barring any kind of economic meltdown, I expect that the second half of 2023 should be a stronger real estate market than the first half of the year.
If you’re having trouble navigating this real estate market, and specifically Intown Atlanta, or want expert advice in your home buying or selling journey, please reach out to us at 404-688-1222. Questions or comments about this market report? Reach me at wtadams@adamscre.com.