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Atlanta home price gains outpace nation

home for saleAtlanta’s home prices rose 5.8 percent during the past year, slightly better than average gains across the country, according to a much-watched national index released Tuesday.

But as increases — especially among lower-priced homes — continue to outpace wage gains, some experts say it makes Atlanta housing less affordable.

Nationally prices gained 5.1 percent, according to the S&P/Case-Shiller House Price Index.

Atlanta and other cities in the south and west lead the nation’s real estate markets, said David Blitzer, chairman of the S&P Dow Jones index committee.

“Nationally, home prices have risen at a consistent 4.8 percent annual pace over the last two years without showing any signs of slowing,” he said. “Overall, residential real estate and housing is in good shape.”

Among the 20 largest metro markets, Portland, Ore., has seen prices rise most rapidly: up 12.6 percent in the past year. Average prices in Seattle were up 11 percent. Slowest growth was in New York and Washington, D.C., both with just 2.0 percent growth.

Atlanta was the ninth-fastest growing, according to Case-Shiller. One of the strongest markets during the housing bubble, Atlanta was hurt more than most by the recession, suffering an estimated quarter-million foreclosures.

Despite steady growth for more than three four years, Atlanta prices are still lower than their peak and some homeowners who avoided foreclosure are still “under water,” their houses worth less on the market than they owe on their mortgages.

The pace of price increases has been slowing. The stock of homes for sale has been historically low overall, but uneven, with a low number of listings among modestly-priced homes and a surplus at the top end of the market.

Now that surplus at the higher tiers may be trickling down.

“There’s getting to be a glut of inventory at the high end,” said Nancy Keenan, realtor at Keller Williams Peachtree Road. “You may have 100 choices at this point. And that is starting to happen at the lower price ranges.

“Now, we are looking at a glut of inventory at $600,000 and up.”

She worked with sellers of a house in Virginia Highland, bought two years ago for $560,000, and priced it at $639,000. “We put it on the market for two weeks. There were 15 showings and no offers.”

Nationally, inventory has been stronger, at about five months of sales – a modest tilt in favor of sellers. In Atlanta, inventory has been running much lower, experts say.

That mismatch of supply and demand is key, said Bill Banfield, vice president of Quicken Loans. “The strong home price growth in much of the country … is led by a continued lack of homes available for sale.”

By: Michael Kanell at The Atlanta Journal-Constitution

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