Everyone is watching the housing market closely as the Federal Reserve continued it’s rate hike, raising interest rates by a quarter percentage point on Wednesday. While the Fed has signaled that they will pause the rate hike, some economists are worried about a potential recession if rates aren’t cut.
GFA caught up with John Hunt, housing economist with MarketNSight to provide perspective on the current housing market in Georgia. Click the image above for our latest Market Minute on YouTube. Here are some key highlights from the latest MarketNSight report:
- Pending sales were down only 6% year to year for the third week of April. The overall trend has been positive since pending sales bottomed in the middle of November 2022.
- Atlanta’s housing deficit is still 62,000 units. It is unlikely that new construction can alleviate the massive deficit as the MarketNSight forecast only calls for 21,000 permits in Atlanta for 2023.
- Permits are a huge problem. Permits were down 16% year to year in 2022, and in the first quarter of 2023, they are down 31%.
“To pull a housing permit, you need a lot to build it on, but the process of entitlement, funding, and gaining municipal approval takes much longer today than it did in the mid-2000’s,” Hunt said. “The result is that some of the lots we began to develop in 2021 are just now starting to come online, but they cannot come online fast enough to help solve our massive inventory deficit.
Learn more at www.marketnsight.com.