While you may have heard that home values in metro Atlanta are on the rebound, nowhere is this more apparent than for homeowners at the low end of the market.
Home values in metro Atlanta overall were up 12 percent in the fourth quarter, according to a new report by Zillow.com, but homeowners in the bottom third of the market saw values jump 20 percent, compared with the same period a year earlier.
This group, of course, had more ground to make up than luxury and high-end homes that lost value lost during the Great Recession’s housing bust.
Owners of homes at the low end are regaining a larger share of the equity they lost, which left them seriously underwater on their mortgages, meaning they owed way more than their home was worth.
Zillow Chief Economist Stan Humphries says the higher values will prompt more owners to put their homes on the market, which will help build the supply of available homes for sale.
The metro area has only a 3.8 month’s supply of homes for sale; six or seven months’ worth is considered normal, according to Metrostudy, the housing trends research firm. The shortage, however, is also helping to push prices, including rents, higher.
“In many ways, for the housing market to fully normalize, it has to start at the bottom,” said Zillow Chief Economist Dr. Stan Humphries. “More lower-end home sellers will help meet demand from entry-level buyers, and these sellers in turn will re-enter the market in search of a slightly pricier home, which will entice more middle- and upper-tier sellers to list their homes.”