Like several cities in the Southern United States, Atlanta has experienced a surge in popularity as a place of work and residence. From a population of approximately 394,017 in 1990, Atlanta’s population grew by more than a quarter (26.7%), reaching 499,127 people by 2022.
When housing markets across America got turbocharged in 2021 and 2022, Atlanta was one among many to feel the pandemic-induced squeeze on home prices and available homes for sale. But after the Fed’s series of rate hikes from 2022 to 2023, many housing markets have been brought back down to earth. The question is how hard the fall back to earth is.
Read on to find out key trends developing in the Atlanta housing market in 2023 and how likely a housing market crash could be.
Atlanta Housing Market 2023: Overview
Through our analysis of housing data sourced from Redfin
In the city of Atlanta proper, home prices peaked in May 2022, when the Atlanta median sale price reached an all-time high of $457,856. Since then, prices have fluctuated but have not witnessed a sustained decline. From a median sale price of $457,856 in May 2022, it decreased by a mere 1.7%, to $449,990 in May 2023. And from June 2022 to June 2023, Atlanta’s median sale price actually increased, by 5.5%, from $415,000 to $438,000. The latest month we have data for is August 2023 and, here again, Atlanta home prices rose year-over-year, by 4.1%: From a median sale price of $400,000 in August 2022 to $416,500 in August 2023.
The city of Mableton, which is a little under 15 miles west-northwest of Atlanta, experienced the largest year-over-year growth in home prices. From a median sale price of $339,950 in August 2022, prices rose by almost a fifth (19.9%), reaching a median sale price of $407,500 in August 2023. The city of Tucker is a similar distance from Atlanta, but to the northeast. Home prices in Tucker rose by almost the same amount as in Mableton — 19.8% year-over-year, from a median sale price of $388,500 in August 2022 to $465,525 in August 2023. Indeed, only four cities in the Atlanta metro area — South Fulton, Stonecrest, Douglasville, and Dunwoody (one of the richest cities in Georgia), saw prices decline from August 2022 to August 2023.
Inventory in the Atlanta Housing Market Continues to Drop
Whereas many other major housing markets, like the Las Vegas housing market, have watched their housing inventory start to build up, in Atlanta this is not the case. Every housing market we analyzed in the greater Atlanta area witnessed declines in available inventory year-over-year. For the Atlanta metro area overall, available inventory dropped by 33.7%, from 26,403 homes for sale in August 2022, down to 17,514 homes in August 2023. In Atlanta proper, the decline was less steep but still a significant drop of 22.8%, from 3,257 available homes in August 2022, down to 2,513 available homes in August 2023.
Three cities in the greater Atlanta housing market saw their housing inventory cut in half: Woodstock, where available inventory fell by 50.9%; Dunwoody, where it fell by 57.5%, and Johns Creek, where it fell by 57.9%. With inventory tightening across the board, it’s not surprising that the majority of cities in the larger Atlanta housing market saw their prices continue to rise from 2022 to 2023.
Houses for Sale in the Atlanta Housing Market Are Staying on the Market Longer than Before
One of the more useful metrics for analyzing housing market activity is the length of time a home for sale spends on the market before getting bought up. Redfin refers to this measure as days on market, which represents the monthly median days on market a home for sale sits before being taken off the market. In the Atlanta metro area, the median number of days on market of a home for sale rose from 21 days in August 2022 to 26 days in August 2023, equal to an annual increase of roughly 23.8%. However, in the city of Atlanta proper, the year-over-year increase in the median days on market was smaller — 16% — rising from 25 days on market in August 2022 to 29 days on market in August 2023.
Below is a table detailing the trends in days on market in the 26 areas we analyzed in the greater Atlanta housing market:
The Bottom Line on an Atlanta Housing Market Crash
Based on the data and our analysis, it does not seem like the Atlanta housing market will crash. One of the biggest indicators of a coming housing crash is a significant build-up in housing inventory. That absolutely has not occurred in the Atlanta housing market. While it’s true homes for sale are sitting on the market longer than last year, the median days on market for most cities in the greater Atlanta housing market have returned to more normal levels, rather than abnormally long.
Another factor arguing against a crash is the fairly consistent sales-to-list ratios in the core cities of the Atlanta metro area. When housing markets are hot, the sales-to-list ratio tends to rise above 100%, as homes get sold for more than their original listed price. While the Atlanta housing market definitely got hot in 2021 and 2022, its sales-to-list ratio has been very steady. Take the city of Atlanta for example:
- Atlanta sales-to-list ratio August 2018: 98.3%
- Atlanta sales-to-list ratio August 2020: 98.1%
- Atlanta sales-to-list ratio August 2022: 98.8%
- Atlanta sales-to-list ratio August 2023: 99.3%
The Atlanta housing market, if anything, seems to be moderating. But the fact that prices are still rising, and inventory is still diminishing means the trouble in Atlanta is not a crash but continued tightening of the housing market.