Atlanta: One of the Most Overpriced Housing Markets in Country
There are many areas that are seeing a boom in real estate but as far as who is coming in on top for possibly the most overvalued market? Atlanta is one of those regions, along with other areas like Austin, Las Vegas, Boise City, and Ogden.
According to a new report, Atlanta is one of the most overpriced residential real estate markets in the country right now and consumers are paying around a 55.96% premium on homes according to one recent study.
The average price of a home for sale has increased drastically and rent has increased as well. Last year the state saw the 6th highest in rent increases around the country. Some sites estimate that the cost of renting a one bedroom compared to this time last year has increased some 14% or more.
There is a stock problem for both buying and renting. Rent in Georgia has increased and the availability of rental units for long term renters has also decreased over the last several years.
It's estimated that there has been some 37% decline in long term rentals since 2019. There is also new pressure being placed on short term rentals, with lawmakers looking to restrict the market in requiring new rules surrounding short term rentals so that more supply can be placed back onto the market. With those new rule changes it has been estimated that some 4000 AirBnb units could be taken off the market.
The average price for a home selling in the area of ATL is about $367,946-$390k.
There might not be enough people living in the region who are earning the sort of income to afford these prices either. For example, some finance experts suggest that a home that costs around $400k would require an income of roughly $79k-$80k, some place it even higher, and yet the median income is much less in the ATL region by some estimates.
It isn't only ATL that is seeing this real estate issue but there are problems with home buying and renting in cities all over the country and elsewhere. We are told repeatedly that it is a supply issue, but we also know that investors and those who own multiple properties make up almost half of the buying market if not more in a variety of regions, so there is no guarantee that an increased supply will end up going to end users at first. Those end users might still need to pay premium prices because they cannot access that supply before it is flipped multiple times first.
While some regions like NY and CA have seen people fleeing and looking elsewhere to find a home, Atlanta is one of the fastest growing metro areas in the nation and thousands of people have been relocating to this area from all over the country.
This is not to be taken as financial advice and has been posted for information purposes only.