This article has been updated to reflect the latest trends in the Atlanta real estate market in 2021. Metro Atlanta housing market has experienced a smooth recovery by far. Despite unemployment and uncertainty, the greater Atlanta residential real estate market performed extremely well during 2020. Home prices were through the roof in 2020 and the pace of appreciation seems to continue in 2021. The median price of a home sold last month in the 11-county area was $372,500. This price is 3.5 percent more than the previous month and 26.3 percent higher than June 2020's median price, according to the Atlanta Realtors Association.

Record-low interest rates and are enticing buyers into the market and giving them more buying power. Even as home values continue to rise, low mortgage rates give buyers more buying power. It's not only low-interest rates pushing up prices to record highs. A lack of homes for sale is a big part of it too. 2021 will be defined by low-interest rates and low inventory, a perfect storm that will continue to push home prices higher. Overall, the Metro Atlanta housing market remains competitive, although not as fiercely so as it was a few months ago. A year ago, metro Atlanta's supply matched a historically low 1.8 months – and it has continued to decrease. By May 2021, inventories represented only one month of supply. However, in June, this increased to 1.3 months. That is still very low, but the shift in the housing supply trend was quite substantial.

How Did The Atlanta Real Estate Market Begin in 2021?

Despite the pandemic, January 2021 home sales were 4,421, a 1.0 percent rise over the previous year. Even as sales increase, the market is restricted by the continuous decline in available inventory, which was cut to 1.2 months supply in January. According to the Atlanta Realtors Association, the inventory of houses for sale in metro Atlanta decreased to 1.2 months. That was about 5 months shorter than what is considered a balanced real estate market.

The median home price in metro Atlanta hit $390,000 in January 2021, an increase of 17.9% from last year. These factors should continue to put upward pressure on sales prices over the next few months. The Atlanta housing market is expected to see one of the country's steepest rises in home prices next year, according to the 2021 housing forecast from Realtor.com. The forecast shows a growth of 6.7% in 2021, compared to a 5.7% increase nationally — putting metro Atlanta in the 20 markets expected to experience the huge home price increases.

Atlanta Housing Market Trends 2021 (Describes June)

Atlanta REALTORS® Association (ARA) released its June 2021 Market Trends on residential housing statistics for 11 area counties in metropolitan Atlanta. The Atlanta Realtors Association report covers Cherokee, Clayton, Cobb, DeKalb, Douglas, Forsyth, Fulton, Gwinnett, Fayette, Henry, and Paulding counties and is compiled by First Multiple Listing Service. Here are the key houisng statistics. 

Housing Demand: In June, residential sales were at 7,637, an increase of 2.0% from the previous year. The number of homes sold in June ranged from 1,027 in DeKalb County to 1,943 in Fulton County. Considering the impact of the pandemic and the continuation of work from home culture, there could be more home sales in suburban areas than in big cities.  

Home Prices:  High demand is met with low inventory and a constrained housing market, driving a sustained upward trend in Atlanta home prices. The result is that the average and median sales prices continue to gain traction and outpace 2020’s figures, with positive gains. The median sales price in June was $372,500, an increase of 26.3% from last June. The average sales price was $452,500, up 28.2% from the previous year.  Among Atlanta’s largest counties, median sales prices ranged from $350,000 in Gwinnett to $435,000 in Fulton. In June, metro Atlanta house prices continued to rise, but an increasing inventory may make it less of a seller's market in the coming months.

Housing Supply: The metro Atlanta housing market has been leaning in favor of sellers for several years, and the shortage of homes has been even more acute during this pandemic. Housing inventory in the Atlanta area totaled 8,739 units in June, a decrease of 40.1% from June 2020. New listings totaled 9,636, up 2.7% from June 2020 and up 12.9% from the previous month. The month’s supply over a 12-month period increased to 1.3 months, which means sellers still cannot meet buyer demand. Experts consider the market balanced when the number of listings is equal to about six months of sales. 

Listing Prices: Realtor.com's June 2021 report shows Atlanta is a seller's real estate market, which means that more people are looking to buy than there are homes available. Home prices have been surging largely because of limited supply and fierce competition for available homes. The median list price of homes in Atlanta, GA was $390K, trending up 14.7% year-over-year while the median sale price was $385,000.

The median listing price per square foot was $250. Sale-to-List Price Ratio: 100%, which means that Homes in Atlanta, GA sold for approximately the asking price on average in June. Ideally, a buyer would prefer a sale to list price ratio that’s closer to 90% while a seller would always prefer scenarios that can yield a ratio of 100% or higher.

There are 205 neighborhoods in and around Atlanta, GA where Realtor.com has listings. Lenox Park has a median listing price of $899K, making it the most expensive neighborhood. Sylvan Hills is the most affordable neighborhood, with a median listing price of $259.9K.

Days on Market: On average, homes in Atlanta, GA sell after 49 days on the market. The trend for median days on market in Atlanta, GA has gone up since last month, and slightly down since last year.

Rental Trends: About 50% of the households in Atlanta, GA are renter-occupied. Atlanta rent prices plunged during the most severe period of the coronavirus outbreak when much of the city’s economy was locked down. It is supposed to have ended eight years of steady rent growth in the Atlanta housing market. Average rents were down 2.2% from March through May for the entire metro Atlanta market. The declines were sharpest in areas of Buckhead, Lindbergh, and Emory, Midtown but the suburban markets did not suffer much.

But the latest market reports show a fast pace recovery from the effects of the pandemic. According to Realpage.com's analysis, there's been a record apartment demand in Atlanta. In fact, the whole Georgia market claimed the nation’s top spot for apartment demand. Atlanta’s 3rd quarter demand tally of 9,008 units accounted for 87% of the market’s annual absorption in the year-ending September.

The rent prices are up whether you compare them annually or monthly. As of August 2, 2021, the average rent for a 1-bedroom apartment in Atlanta, GA is currently $1,650. This is a 14% increase compared to the previous year. Over the past month, the average rent for a studio apartment in Atlanta remained flat. The average rent for a 1-bedroom apartment increased by 5% to $1,650, and the average rent for a 2-bedroom apartment increased by 1% to $2,108.

• Two-bedroom apartments in Atlanta rent for $2,108 a month on average (a 12% increase from last year).
• Three-bedroom apartment rents average $2,250 (a 19% increase from last year).
• Four-bedroom apartment rents average $2,350 (a 12% increase from last year).

The Zumper Atlanta Metro Area Report analyzed active listings in June 2021 across 8 metro cities to show the most and least expensive cities and cities with the fastest-growing rents. The Georgia one-bedroom median rent was $1,108 last month. Atlanta was the most expensive city with one-bedrooms priced at $1,520 while Athens ranked as the most affordable city with one-bedrooms priced at $980.

The Fastest Growing Cities in The Atlanta Metro Area (Year-Over-Year) 

• Athens had the fastest-growing rent, up 15.3% since this time last year.
• Marietta saw rent climb 13.6%, making it the second-fastest-growing.
• Alpharetta was third with rent jumping 11.5%.

The Fastest Growing Cities in The Atlanta Metro Area (Month-Over-Month)

• Marietta had the largest monthly rental growth rate, up 3.5%.
• Smyrna was second with rent climbing2.4%.
• Atlanta saw rent increase 1.3% last month, making it third.

Atlanta Real Estate Market Forecast 2021-2022

Atlanta has been one of the hottest real estate markets in the country for years. It is also one of the hottest real estate markets for investing in rental properties. Population growth has had a positive impact on the housing market in Atlanta. Nearly 285,000 people moved to Georgia in 2019, according to the most recent data from the U.S. Census Bureau.

This migration has been made possible the state's consistent ‘best state for business' rankings. Area Development magazine named Georgia No. 1 for business – for seven straight years (2014-20). Nine out of 10 Fortune 500 companies have operations in Georgia – and 18 of these have made Georgia their world headquarters.

Much of this migration is driven by the strong business environment in Atlanta and the relative affordability of the city. Its robust knowledge-based economic ecosystem attracts new talent to the city. The net migration has led to an ever-increasing demand for housing in Atlanta which cannot be met with the current pace of the new construction.

The Atlanta housing market has a housing shortage which will continue to contribute to increasing prices. Atlanta home prices on average are less expensive than the national average. Despite being below the national average, Atlanta home prices have more than doubled since 2012, and are projected to continue increasing.

Let us look at the price trends recorded by Zillow over the past few years. Atlanta has a track record of being one of the best long-term real estate investments in the U.S. Since 2012, the Atlanta home values have appreciated by nearly 138% — Zillow Home Value Index. 

ZHVI represents the whole housing stock and not just the homes that list or sell in a given month. The typical home value of homes in Atlanta is currently $333,760. It indicates that 50 percent of all housing stock in the area is worth more than $333,760 and 50 percent is worth less (adjusting for seasonal fluctuations). In August 2020, the typical value of homes in Atlanta was around $300,000. Atlanta home values have gone up 12.2% over the last twelve months.

NeighborhoodScout.com's data also shows that Atlanta real estate appreciated by nearly 83% over the last ten years. Its annual appreciation rate has been averaging at 6.23%. This figure puts it in the top 10% nationally for real estate appreciation. During the latest twelve months, the Atlanta appreciation rate was nearly 6.02%, and in the latest quarter, the appreciation rate was 1.96%. If it remains steady, it annualizes to a rate of 8.06%.

Here is Zillow's home price forecast for Atlanta, Fulton County, and Atlanta Metropolitan Area. The forecast is until April of 2022 and you can expect to see very strong home price gains in this region. It is going to be a strong seller's market that will be much more stable than the unpredictable trends experienced this year.

• Atlanta-Sandy Springs-Roswell Metro home values have gone up 17.4% over the past year and the latest forecast is that they will rise by 15.4% over the next twelve months.
• This figure corroborates with Realtor.com's forecast, which also predicts that home prices in this region are expected to increase by nearly 6.7% in the next twelve months.
• Atlanta home values have gone up 12.2% over the past year and will continue to rise at a similar pace in the next twelve months.
• Fulton County home values have gone up 13.5% over the past year and will continue to rise at a similar pace in the next twelve months.

Here is the visual representation of how home prices have grown from 2011 and their forecast (in the green area) until June 2022.

The change in home prices for Atlanta-Sandy Springs-Roswell, GA are shown below for three time periods by LittleBigHomes.com. The Atlanta Home Price Index has increased for the last 25 consecutive quarters (data up to 3rd Quarter, 2018). The highest annual change in the value of houses in the Atlanta Real Estate Market was 15% in the twelve months ended with the 1st Quarter of 1980.

Is Atlanta is going to remain a seller's real estate market in 2021?

These numbers can be positive or negative depending on which side of the fence you are — Buyer or Seller? While many have lost jobs, making them ineligible for a home mortgage, some sellers have taken their homes off the market. The decrease in the number of active listings indicates that new sellers are still not willing to put their homes on the market until the pandemic or its threat is completely over.

At the same time, the industry is adapting to the current environment by conducting business using technologies such as virtual showings and e-signing to help buyers and sellers with their housing needs in the face of these challenges. While some economic activity will resume as the state gradually reopens, the housing market is expected to remain sluggish for the next couple of months until the economy opens up completely. Sellers, brokers, and homebuyers seem to be adjusting to restrictions imposed on the real estate industry because of the coronavirus pandemic.

The constraint on available inventory and a decline in new listings is keeping the Atlanta real estate market skewed to sellers. Atlanta and the entire metro area market is so hot that it cannot shift to a complete buyer’s real estate market, for the long term. The Atlanta real estate market benefits from a large and robust economy.

According to the data insights provided by the Bureau of Economic Analysis, the Atlanta metro area was the tenth-largest in the U.S. and among the top 20-largest in the world (as of 2020). The housing demand in Atlanta is still high across the 11-county metro area. To counter the effects of this ongoing crisis, FED did an emergency rate cut which put rates at their lowest level in the last 50-year span.

The low-interest rates are already leading to an increase in mortgage applications. Buyers looking for this opportunity to invest or buy a house. Low-interest rates coupled with Atlanta’s solid job market could be a boon for the local real estate market even in the time of the Covid-19 pandemic. Keeping aside the short-term effects of Covid-19 which would hopefully end, the Atlanta housing market is strong. There are no signs of weakness in the Atlanta real estate prices.

In a balanced real estate market, it would take about five to six months for the supply to dwindle to zero. In terms of months of supply, Atlanta can become a buyer’s real estate market if the supply increases to more than five months of inventory. And that’s not going to happen. This housing market is skewed to sellers due to a persistent imbalance in supply and demand.

Whether you’re looking to buy or sell, timing your local market is an important part of real estate investment. For buyers in Atlanta, the mortgage rates are at their lowest. So they should take advantage of scooping up their favorite deals which otherwise are taken away by seasoned investors in the bidding wars.

Please do not make any real estate or financial decisions based solely on the information found within this article. Real estate market forecasts given in this article are just an educated guess and should not be considered financial advice. Many variables could potentially impact the value of a home in Atlanta in 2021 (or any other market) and some of these variables are impossible to predict in advance. Real estate prices are deeply cyclical and much of it is dependent on factors you can’t control.

Impact of COVID-19 on The Atlanta Housing Market

We shall now do a quick recap of the impact of the COVID-19 Pandemic on the Atlanta housing market. With social distancing becoming a way of life across the country, Atlanta’s tourism industry has taken a considerable hit in light of this deadly pandemic. Many big events like the NCAA basketball tournament were canceled to avoid the spreading of infection among huge crowds. The local businesses are feeling the brunt of the outbreak, too. The economy is bound to be hit in the short term. However, Atlanta's housing market showed a quick recovery.

The single-family residential housing market in metro Atlanta got impacted by the pandemic with home sales plummeting from April onward. There was a significant reduction of 25.8% in sales for April as compared to last year's numbers. According to the latest report from Atlanta REALTORS® (ARA), residential sales continued to decrease in May as well.

The housing market in Atlanta experienced a 25.8% decline in sales for April as compared to last year. New listings dropped by 32.2% compared to April 2019. April's new listings decreased more than 18% compared to March's new listings as sellers decided to back out in this crisis. Housing inventory in the metro Atlanta area housing market decreased by 13.4% from April 2019. In Fulton County, there were 744 units sold in April at a median price of $405,000 and an average price of $506,000.

Total home sales in May in the 11 counties of metro Atlanta dropped by 37%. The drop in May was steeper than the 25.8% decrease recorded in April. The median sales price in May was $291,000, an increase of 0.3% from last May. The average sales price was $351,000, down 0.6% from the previous year's average of $353,000. As you can see the Atlanta housing prices are holding strong with hardly any decline due to the ongoing pandemic. However, compared to last month (April), the median sales price dropped by 3.6% and the average price dropped by 3.3%.

Monthly Comparison

While Atlanta housing prices remain almost steady as compared to last year, the decline in sales reflects the impact of the shelter-in-place order that Metro Atlanta residents had to follow.

Georgia Multiple Listing Service (GAMLS) has released its market recap for August 2020. The following numbers reflect all residential listings sold in the 29 county Atlanta Metropolitan Statistical Area (MSA). It compares the 29-county metro area's housing metrics from August 2020 with August 2019. This information is deemed reliable but not guaranteed.

Residential Units Sold – 2016 – Present

***The most recent housing data has already been discussed above***

Atlanta Real Estate Investment: Where To Buy Atlanta Rental Properties?

Is Atlanta real estate overvalued? Let’s talk a bit about Atlanta and the surrounding metro area. Atlanta is a minimally walkable city in Fulton County with a population of approximately 419,590 people. Atlanta has a mixture of owner-occupied and renter-occupied housing units. According to Neighborhoodscout.com, a real estate data provider, one and two-bedroom large apartment complexes are the most common housing units in Atlanta.

Other types of housing that are prevalent in Atlanta include single-family detached homes, duplexes, rowhouses, and homes converted to apartments. The Atlanta real estate market has had steady growth over the past several years that make it a great place to live as well as invest in. Located in the state of Georgia, the city of Atlanta is a hotspot for any type of real estate investing. It is a city with an incredible amount of upside.

The cost of living in Atlanta is reasonable when compared to other big cities like Los Angeles or New York. Everybody loves the low cost of living in Atlanta but the students especially appreciate it making it one of the top rental markets in the United States. This factor alone draws young professionals priced out of those pricier markets.

If you are a savvy investor, you must be aware of the fact that Atlanta real estate has a record of being one of the best long-term investments in the nation. As an investor, you can buy a fully renovated turnkey rental property in Atlanta. It would be the best option for novice real estate investors looking for a steady rental income. Atlanta is a favorite place to live in for millennials who prefer renting over owning.

In the last five years, Atlanta’s job growth averaged 2.3 percent annually, outpacing the national average of 1.6 percent. The attractive cost of living and a multitude of jobs in various industries has made Atlanta one of the hottest residential and labor markets in the country. It continues to grow in terms of population and employment. The population of Atlanta is predicted to reach 8 million by 2040, according to a survey conducted by the Atlanta Regional Commission.

This will further increase rental demand in Atlanta. Atlanta is Georgia’s capital and economic center. It is considered one of the 10 most productive states that contribute to the USA’s GDP annually. As the city continues to go through an economic boom, prices of turnkey properties in Atlanta are forecasted to increase in the following years. People will want to beat out the competition and purchase soon if they’re looking to develop a successful career, surrounded by a diverse community, especially for today’s youth.

Atlanta has shown promising population growth and employment, which are two signs of a healthy real estate market. In the Atlanta metropolitan area, the leisure and hospitality industry had the largest employment gain from October 2018 to October 2019, up 14,700, or 4.9 percent. Local job gains occurred primarily in the food services and drinking places subsector (+11,400). Nationwide, employment in the leisure and hospitality industry rose 2.3 percent over the year.

Buckhead Heights, Atlanta, GA

The urban neighborhood of Buckhead Heights has a population of roughly 2,130 people. Residents have been ranked as A, based on ethnic and economic diversity, with many of its residents having bachelor’s or master’s degrees. The average resident earns approximately $93,009. However, the cost of living falls into a grade of B. There are at least 23 public schools that serve this neighborhood; three having ranked as A-. They are the Smith Elementary School, and the Atlanta Neighborhood Charter School for Elementary, and Middle school.

Public education is given the grade of B. Crime rates are pretty low in this area as it is given the grade of B. In the category of violent crimes, only 47 cases of robberies are reported per year. Unfortunately, the Buckhead Heights neighborhood has some property crime cases. The median value of the homes in this neighborhood is $296,500 and the median rent is $1,809. About 59% of the residents like to rent in this neighborhood.

Hanover West, Atlanta, GA

Located in the northern part of Atlanta, Hanover West was deemed the #1 best neighborhood in the city by neighborhood and school-rating website Niche. With a population of roughly 2,930 people, most residents appear to be young adults with bachelor’s degrees. Regarding ethnic and economic diversity, Niche.com rates Hanover West at a grade of B. Moreover, Hanover West Atlanta has been considered to be one of the safest neighborhoods, with few to no recorded violent crimes in the past year. On average, Hanover West has seen 63 burglary and theft incidents per 100,000 residents.

With about 13% of its population being children, there are about 23 public schools around the area. School ratings average at a B, with the best performing public schools being the Atlanta Neighborhood Charter School for Kindergarten through 8th grade. Its middle school campus is ranked #1 as the best charter school in Georgia. The median value of homes in this neighborhood is around $298,736, while rent prices are approximately $1,190. These rates are considerably worth more when compared to the national average home value and rent prices which are $184,700 and $949, respectively.

Collier Hills North, Atlanta, GA

The lovely neighborhood of Collier Hill North has a population of 3,561 and has a grade of A- regarding ethnic and economic diversity. The median household income of this area is calculated to be $68, 569, and approximately 36% of residents have obtained a bachelor’s degree. Niche.com gave public school education a grade of B-. Of the 23 public schools in this area, two are graded A-. Additionally, Collier Hills North is one of the safest neighborhoods on this list as it is given a grade of A+.

There are no reported violent crimes in the area, and only an average of 52 petty crimes are committed under the theft and burglary category. The cost of living is known to have a grade of B-. The median home value in Collier Hills is $715,177. Collier Hills' home values have gone up 2.4% over the past year and Zillow predicts they will fall -1.3% within the next year. The median cost of rent is approximately $1,289, higher than the national average of $949. Most residents have chosen to buy their homes, instead of rent. Collier Hills is one of the best suburbs to invest in the Atlanta real estate market.

Brookwood, Atlanta, GA

A more extensive neighborhood, Brookwood Atlanta consists of 6,046 people with children compromising 5% of the total population. 48% of its residents are noted to obtain bachelor’s degrees. Regarding median household income, residents of Brookwood earn an outstanding $74,057 annually. It has a grade of A for ethnic and economic diversity. On the other hand, the grade of public school education in this area is a B-. However, among the 26 schools that serve this area, five public schools have a class of at least A.

The Grady High school, Atlanta Neighborhood Charter School of both the Elementary and Middle school campuses receive a grade of A. The Inman Middle School and Springdale Elementary School both received a grade of A-. Brookwood Atlanta has been given a grade of A- regarding crime and safety. In terms of violent crimes, 19 cases of robbery are estimated to occur per 100,000 in a year. However, Brookwood has many instances of petty crimes in its neighborhood.

Despite these grades, Brookwood Atlanta has a median home value of $349,879 and a median rent of $1,432. Given those estimates, it is not a surprise to find that 61% of its resident choose to rent their homes whereas only 39% own their houses. Due to the high population of renters, the Brookwood neighborhood is a great choice to invest in Atlanta rental properties. 

Cross Creek, Atlanta, GA

Cross Creek's neighborhood has located near the Atlanta Memorial Park, with a population of approximately 2,143 residents. In the past year, the website Niche.com has rated it as one of the best places for millennials in the Atlanta area. The neighborhood boasts a high diversity rating based on ethnicity and economic status. Most residents appear to be young adults and adults up to 30 years old with bachelor’s degrees. Only 9% of its population is children.

Cross Creek was given a crime & safety rating of B by Niche.com. Per 100,000 residents, there have been some violent crimes, although all below the national average. As for its motor vehicle theft cases, the neighborhood appears to have a higher-than-average count of 511 cases, compared to the national average of 263.

That being said, Cross Creek housing was given a rating of A-, with its median home value being estimated at $192,795. while the median rent is $1,369. Surprisingly, statistics show that homeowners and renters are split in the area at exactly 50% for both. It is also considered to be a good place to live in Atlanta. Investing in Atlanta rental properties in this neighborhood would be a good investment decision.

Hills Park, Atlanta, GA

Hills Park is another good neighborhood of Atlanta with a population of approximately 54,152. Similar to the other neighborhoods, most of the residents in Hills Park Atlanta have obtained a bachelor’s degree, having a percentage of 45%. White-Collar employment amounts to 86.47 %. The median household income of this area is $47,918. Public school education is given a rank of B-, with 30 public schools serve this area. Among these selections, four schools are given a grade of A- and above.

Grade High School has the highest rank regarding the quality of education with a degree of A. The three remaining schools receive an A-. Hills Park is rated B+ on crime and safety. Only 84 cases of robbery are reported per 100,000 residents in one year. However, a considerable number of petty crimes occur in this area, the majority of them falling under the category of theft.

Nonetheless, it is known as a safe neighborhood among folks. Hills Park Atlanta has a median home value of $305,162. and the median rental price of homes in this area is $1,526. Even so, the majority of residents choose to own their homes. 52% of its residents own their homes, while 48% are renting them. Hills Park is one of the best places for living in Atlanta and can be chosen for investing in rental properties.

Midtown Atlanta, GA

Midtown Atlanta is the second-largest business district in the city of Atlanta, situated between the commercial and financial districts of Downtown to the south and Buckhead to the north. Midtown is home to some of Atlanta's priciest apartments. It is a large area of Atlanta immediately north of Downtown with many sites and activities. The skyscraper district aligns with Peachtree Street. To the east of Peachtree Street is Piedmont Park, and to the west are Atlantic Station and the Georgia Tech campus area. With a population of 22, 539, the neighborhood of Midtown Atlanta is the largest in terms of population.

Only 5% of the total population are children. Like the other neighborhoods, people with a bachelor’s degree are the largest among education levels, consisting of 38% of the population. The middle-class household income in this area is $74,194, which is considerably lower compared to the other neighborhoods. Ethic and economic diversity are graded A. Public school education receives a grade of B-. 28 public schools serve this neighborhood, and six of them have been given a grade of A- and higher. Grady High School boasts the highest grade received, which is A. The remaining schools all receive A-.

Unfortunately, Midtown Atlanta has a low score on the crime and safety portion. With a grade of C, the neighborhood has a lot of recorded violent and property crimes. Nonetheless, residents claim that Midtown is the “pulse of the city”, highlighting that living here is a great experience. Likewise, it gained a high rating in the nightlife category. With these ratings, the median home value of this Midtown Atlanta is at $355,944 and the median rental price is $1,444. 55% of its population chose to rent their homes, while the remaining 44% own them. According to Zillow, Midtown Atlanta's home values have gone up 2.4% over the past year. Therefore, Midtown can be considered for investing in Atlanta rental properties. 

Candler Park, Atlanta, GA

Candler Park is a city park located at 585 Candler Park Drive NE, in Atlanta, Georgia. According to Wikipedia, it is named after Coca-Cola magnate Asa Griggs Candler, who donated this land to the city in 1922. Candler Park Atlanta is another large neighborhood regarding population. According to Point2homes.com, the total population of this neighborhood is 19,652. Similar to the other neighborhoods, public school education in this Candler Park Atlanta has a score of B from Niche.com. Among 26 public schools that serve this area, six of them have a rating of at least A-.

Grady High School has a grade of A, making it the highest quality public school in the area. The other schools are graded with a score of A. Regarding crime and safety, Candler Park Atlanta fares as well as Midtown. It has a grade of C+ and many recorded cases of violent and property crimes. A review indicated that in the case of reported criminal activity, police officers are quick to respond. Its median home value is the second-highest on the list, which is estimated to be $450,226. On the other hand, the median rent in this area amounts to $1,222.

The median household income is $100,885. The majority of the residents own their houses, consisting of 60% of the population. The remaining 40% choose to rent their homes. Given the fact that Candler Park is ranked among the best places to live and raise a family in Atlanta, we recommend this neighborhood for investing in rental properties for the long term. According to Zillow, Candler Park home values have gone up 3.6% over the past year.

North Buckhead, Atlanta, GA

North Buckhead Atlanta is a neighborhood in the Buckhead district, at the northern edge of the city of Atlanta, Georgia, and is one of Atlanta's most affluent neighborhoods. North Buckhead Atlanta is also the second-largest neighborhood in terms of population. It has a population of 10,848, according to Point2homes.com. Despite its large community, it has a grade of A- regarding ethnic and economic diversity on Niche.com.

North Buckhead is an uptown commercial and residential district of Atlanta, Georgia. It mostly consists of large single-family homes that are situated among dense forests and rolling hills. As far as crime is considered, much of Buckhead is considered to be safe, except for the Lindbergh neighborhood.

North Buckhead Atlanta has a higher score on the portion of public school education quality. With a grade of B, 35 public schools serve this area. Though only six of them have a rating of A-. These schools are Atlanta Neighborhood Charter School, The Main Street Lower Academy, Riverwood International Charter School, Smith Elementary School, and Jackson Elementary School. The crime and safety portion has a bit lower score of B-. The area has numerous reported cases of violent and property crimes.

Nonetheless, reviewers describe the region as a “truly great place to live, work, and play.” North Buckhead Atlanta has the highest median home value on the list with $588,242. The median rent price is $1,474. The median household income of people in this area is $134,673. Even so, 53% own their homes while 47% rent them. That's almost half of the total population. North Buckhead home values have gone up 0.2% over the past year and Zillow predicts they will fall -2.3% within the next year. Although the home prices are quite high, this neighborhood is currently a buyer's market and this is the right time to invest in a property.

North Springs, Atlanta, GA

North Springs is a quiet neighborhood and has amazing proximity to everything you could want. It is located in the famous city of Sandy Springs which is the most expensive neighborhood in Atlanta. It is a city in northern Fulton County, Georgia, United States, and part of the Atlanta metropolitan area. Both The North Springs and Sandy Springs Stations were opened on December 16, 2000, as part of MARTA's most recent expansion, adding two more stations north of the Dunwoody Station.

The market temperature is neutral at the moment. It is a balanced real estate market. The median home value in Sandy Springs is $512,458. Sandy Springs home values have gone up 2.3% over the past year and Zillow predicts they will fall -2.0% within the next year. The median household income is around $84,000 and a40% of the population like to rent a house in this neighborhood of Atlanta.

Purchasing the best investment properties in Atlanta appears to be on the pricier end. However, this is because you’re also purchasing other positive aspects of the estate such as security, and community diversity. You’re paying for quality real estate in Atlanta when you decide to buy investment properties in the neighborhoods listed above. One disadvantage may come from families looking for premier schools for their children. Most of the schools surrounding the neighborhoods listed in this article are given ratings of B on Niche.com. Considerably, it may be a not so good decision for parents who want their children to attend the best schools in the country.

That being said, Atlanta appears to be a wise choice of city for the youth. In many of the above-mentioned neighborhoods, their residents seem to be young adults, based on their educational attainment. Likewise, Atlanta has come to be a bustling economic center. This is an advantage for people looking to begin or improve their careers. Good cash flow from Atlanta rental property means the investment is, needless to say, profitable. On the other hand, a bad cash flow means you won’t have money on hand to repay your debt. Therefore, finding a good Atlanta real estate investment opportunity would be key to your success.

When looking for real estate investment opportunities in Atlanta or anywhere in the country, the generally accepted standard is to purchase a property that will give you a modest but minimum 1% profit on your investment. An example would be: at $120,000 mortgage or investment cost, $1200 per month rental. That would be the ideal equation for example. Even with rent increases, buying a $500,000 investment property in Atlanta is not going to get you $5000 per month on rent.

When looking for the best real estate investments in Atlanta, you should focus on neighborhoods with relatively high population density and employment growth. Both of them translate into high demand for housing. If housing supply meets housing demand, real estate investors should not miss the opportunity since entry prices of homes remain affordable. The neighborhoods in Atlanta must be safe to live in and should have a low crime rate.

The neighborhoods should be close to basic amenities, public services, schools, and shopping malls. A cheaper neighborhood in Atlanta might not be the best place to live in. A cheaper neighborhood should be determined by these factors – Overall Cost Of Living, Rent To Income Ratio, and Median Home Value To Income Ratio. It depends on how much you are looking to spend and if you are wanting smaller investment properties or larger deals in Class A neighborhoods.

Atlanta, Georgia Real Estate Investment Opportunities

Buying or selling real estate, for a majority of investors, is one of the most important decisions they will make. Choosing a real estate professional/counselor continues to be a vital part of this process. They are well-informed about critical factors that affect your specific market areas, such as changes in market conditions, market forecasts, consumer attitudes, best locations, timing, and interest rates.

NORADA REAL ESTATE INVESTMENTS has extensive experience investing in turnkey real estate and cash-flow properties. We strive to set the standard for our industry and inspire others by raising the bar on providing exceptional real estate investment opportunities in many other growth markets in the United States. We can help you succeed by minimizing risk and maximizing the profitability of your investment property in Atlanta.

Consult with one of the investment counselors who can help build you a custom portfolio of Atlanta turnkey properties. These are “Cash-Flow Rental Properties” located in some of the best neighborhoods of Atlanta.

Not just limited to Atlanta or Georgia but you can also invest in some of the best real estate markets in the United States. All you have to do is fill up this form and schedule a consultation at your convenience. We’re standing by to help you take the guesswork out of real estate investing. By researching and structuring complete Atlanta turnkey real estate investments, we help you succeed by minimizing risk and maximizing profitability.

Georgia's real estate market is a great place to invest in real estate. You can also invest in Savannah real estate market. Savannah, Georgia is separated from South Carolina by the namesake Savannah River. This means the Savannah housing market includes quite a few people living in South Carolina. The Savannah real estate market includes roughly 350,000 people. This makes it the third-largest metropolitan area in Georgia. If you take the de facto suburbs on the Carolina side, these small towns put half a million people in the larger Savannah metro area.

Georgia is bordered to the north by Tennessee and North Carolina, to the northeast by South Carolina, to the south by Florida, and to the west by Alabama. All of these states have some of the best real estate markets where you can buy rental properties.

Charlotte is one such place that we would recommend. Charlotte is the largest city in North Carolina. The city proper is home to more than 800,000 people. The Charlotte Metropolitan Statistical Area is even larger – home to roughly two and a half million people.

It is one of the country’s fastest-growing metro areas, and it was the second fastest-growing city in the southeastern United States. Buying real estate in Charlotte is a good investment, depending upon several factors.

There are so many major companies and professional sporting events that people will always be interested in residing here. Therefore, interested investors aren't likely to allow the listing prices to get too low before they swoop in and take advantage.

On the west of GA is the state of Alabama. Birmingham, Al has seen an upward trend in terms of its population growth. One factor that has led to this increase is its rich nature of mountainous ridges and a good share of physical scenery.

Since its year of discovery, the city has been an educational center of the state of Alabama and has been the favorite destination of many educational aspirants who come here to seek the careers of their choice. Hundreds of schools have been set up in the city of Birmingham and several top-notch universities.

The city's ever-growing population shows a need for real estate investments and developments for the good of the new growing population. There are several good reasons to invest in Birmingham properties.

Let us know which real estate markets in the United States you consider best for real estate investing! 

Remember, caveat emptor still applies when buying a property anywhere. Some of the information contained in this article was pulled from third-party sites mentioned under references. Although the information is believed to be reliable, Norada Real Estate Investments makes no representations, warranties, or guarantees, either express or implied, as to whether the information presented is accurate, reliable, or current. All information presented should be independently verified through the references given below. As a general policy, Norada Real Estate Investments makes no claims or assertions about the future housing market conditions across the US. 

References:

Market Prices, Trends & Forecasts
https://www.gamls.com/statistics
https://www.atlantarealtors.com/
https://www.zillow.com/atlanta-ga/home-values
https://www.atlantarealtors.com/Resource-Center/abr-market-brief.aspx
https://www.realtor.com/realestateandhomes-search/Atlanta_GA/overview
https://www.realwealthnetwork.com/markets/atlanta-georgia
http://www.metrodepth.com/atlanta/
http://www.justluxe.com/travel/atlanta-news__1899269.php
https://www.bizjournals.com/atlanta/news/2020/06/15/metro-atlanta-housing-sales-tumble-37-may.html
https://atlanta.curbed.com/2020/3/17/21182334/coronavirus-atlanta-home-buying-real-estate-covid-19

Foreclosures
https://www.realtytrac.com/statsandtrends/ga/fulton-county/atlanta

Neighborhoods & Statistics
https://www.niche.com/places-to-live/search/best-neighborhoods/t/atlanta-fulton-ga
https://www.homesnacks.net/richest-neighborhoods-in-atlanta-128964
https://www.point2homes.com/
https://www.zillow.com/

The California housing market ended the previous year on a high note as sales remained strong in December and the median house price reached another record high. The same momentum has been carried forward in 2021 as the housing market in California remains fiercely competitive. Despite a new record sales price, growth slowed and pending sales dipped for the first time since May 2020, as reported by C.A.R. for June 2021. Homes in California are on the market for a median of seven days before going under contract, with 70% of homes selling for more than their asking price.

California's median home price set a new record high for the fourth consecutive month in June, rising 0.2 percent month over month to $819,630, up from $818,260 in May and 30.9 percent from $626,170 in June last year. For the third month in a row, the median price in California remained above the $800,000 mark, and it was the third month in a row that the state had an annual increase of more than 30%.  It was the third time since June 2013 that the state recorded an annual increase of over 30 percent, according to the California Association of Realtors (C.A.R.).

Tight inventory and low mortgage rates, similar to national housing market trends, are fueling the rise in California home prices. While this type of price appreciation has an impact on housing affordability, higher home prices should encourage more sellers to list their homes for sale, slowing the rate of appreciation. However, the rate of increase in home prices appeared to be slowing, as the difference between May and June remained below one percent, and the increase was the smallest in four months. Another interesting statistic is that the statewide median price increase in June 2021 was slightly lower than the 1.0 percent average May-to-June growth rate observed between 1979 and 2020.

Home sales in June fell 2.2 percent from 445,660 in May but were up 28.3 percent from a year ago when 339,910 homes were sold on an annualized basis. Closed escrow sales of existing single-family detached homes in California totaled 436,020 in June, according to a seasonally adjusted annualized rate of 436,020. With strong sales growth in June, the state housing market ended the first half of the year with a 33.6 percent year-to-date increase. Higher-priced markets performed well, while lower-priced property sales remained below last year's levels.

Pending sales are down for the first time in 14 months. The overheated housing market is showing signs of a much-needed cooling, which could indicate waning buyer interest as a result of the rapid pace of home price increases and buyer fatigue. However, the number of new listings increased in June, as did the share of listings with a reduced price and the median reduction amount, providing buyers with more options.

Housing price gains were widespread with all the 51 counties in the state seeing annual price gains and 47 of them reporting at least a double-digit growth rate from last June. Twenty-five counties set new record high median prices in June. Del Norte had the largest price gain of 48.1 percent in June, followed by Siskiyou (40.5 percent) and Santa Barbara (39.2 percent).

In June 2021, four of the five major regions set new highs for median prices, with each region increasing by more than 20 percent from a year ago. The San Francisco Bay Area continues to have the highest year-over-year gain of 35 percent, followed by Southern California (30.3 percent), the Central Valley (23.8 percent), the Far North (22.0 percent), and the Central Coast (20.8 percent).

• The San Francisco Bay Area had the highest year-over-year gain of 35 percent, with the median price being $1,350,000.
• Southern California had a year-over-year price gain of 30.3 percent, with the median price being $766,000.
• The Central Valley had a year-over-year price gain of 23.8 percent, with the median price being $452,000.
• The Far North had a year-over-year price gain of 22.0 percent, with the median price being $380,000.
• The Central Coast had a year-over-year price gain of 20.8 percent, with the median price being $890,000.
• The Los Angeles Metro Area had a year-over-year price gain of 33.4 percent, with the median price being $737,500.
• Inland Empire had a year-over-year price gain of 28.0 percent, with the median price being $525,000.

California is a seller’s market and home prices have reached new record-highs across all the regions due to tight supply. Homes are moving nearly 46% faster than a year ago; the median time on the market was 8 days in June. Nearly 70% of homes sold above the asking price in May. New construction can’t keep up with demand in the California housing market. Every major region saw home prices continuing to increase from last year by double digits as buyers competed amid a shortage of homes for sale.

There is an increase in demand leading to bidding wars and subsequent higher selling prices. These trends show us that the California housing market remains very competitive. Growth of sales are prices are driven by low mortgagee rates, buyers seeking more living space, and a perennial shortage of houisng supply. Homes are selling quickly with a minimal price reduction. The statewide sales-price-to-list-price ratio was 104.1 percent in June (a record high). If it's above 100%, the home sold for more than the list price. If it's less than 100%, the home sold for less than the list price.

High demand across all of California's sub-markets means that low inventory and lightning-fast market conditions are not going away soon. There just aren’t enough homes listed for sale to satisfy the demand from buyers. Typically, the housing supply rises during this time of year and continues to rise until late July/early August. More new listings were added, but they remained below the pre-pandemic level. C.A.R.’s Unsold Inventory Index (UII) remains low at 1.7 months in June, slightly down from May but remained sharply below last year’s level. The index indicates the number of months it would take to sell the supply of homes on the market at the current rate of sales.

Will The Housing Market Go Up or Down in California?

Each month C.A.R. surveys 1,000 California consumers regarding their sentiments about various aspects of the housing market or the economy that directly impact housing to create a California Housing Sentiment Index. In June 2021, the overall housing sentiment index reached 72 (-2 from last month). The California housing market is showing signs of normalization, as high prices and a competitive, gradually improving economy continue to entice more sellers back into the market.

Furthermore, C.A.R. reported last week that June was another double-digit month in the state for both sales and prices. Mortgage rates, on the other hand, have begun to fall modestly, which may combine with slightly more inventory in the coming weeks to fuel a rebound in potential homebuyers. Encouragingly, the number of new listings being added to the MLS each day has finally started to exceed closed sales and C.A.R. is still forecasting at least 10% growth in home sales this year. If the economy improves, rates could keep rising slowly, but many experts expect borrowing costs to remain low by historical standards throughout 2021. Here's what consumers feel at this time.

Is it a good time to buy a home in California?

C.A.R.’s monthly Consumer Housing Sentiment Index for June 2021 found that only 19% of consumers believe that now is the good time to buy a home, and 81% think this is not a good time to buy. That’s no change in this consumer sentiment from last month. As a result of continuously rising prices in all the major regions, the housing market sentiment also shows that only 25% of the consumers feel that it will be easier to find a home over the next twelve months (+2 from last month's survey). 75% said it won't be easier.

Is it a good time to sell a home in California?

According to the survey, 68 percent of Californians believe now is a good time to sell a home. That’s a decrease of -4 over the May 2021 poll. More than half of the consumers (61%) who participated in the survey feel that home prices will rise in the 12 months. That’s a decline of -1 from the previous month. Only half of the people are optimistic about the economy's recovery. 47% (-1 from last month) believe that economic conditions will improve in the state over the course of the next 12 months while 53% still have a gloomy outlook.

California Housing Market Trends 2021 (Describes June)

Here are some of the key points of the California housing market report for June 2021, according to the July 16 release by C.A.R.

Existing-Home Sales

• With strong sales growth in June, the California housing market ended the first half of the year with a 33.6 percent year-to-date increase.
• Higher-priced markets performed well, while lower-priced property sales remained below last year's levels.
• Over last year, demand for million-dollar homes increased by triple digits, with sales of homes priced $2 million and above increasing by 141 percent.
• Sales of homes priced under $300,000, on the other hand, continued to fall steeply in June, with the year-over-year growth rate falling by 48 percent.
• Tight housing supply remains the primary constraint on sales in the lower price segment.
• In the second quarter of 2021, the state sold more homes in the million-dollar market than in the sub-$500,000 market, which has never happened in California before.
• At the regional level, all major regions had at least double-digit year-over-year growth in sales from last June.
• The San Francisco Bay Area had the highest year-over-year increase of 34.1 percent with seven of the nine counties increasing more than 29 percent from a year ago.
• Southern California came in second with a growth rate of 33.9 percent from last year.
• The Central Coast region also experienced double-digit year-over-year increases of 26.6 percent in sales from a year ago.
• The Far North posted a sales gain of 17.6 percent.
• The Central Valley also remained strong and experienced double-digit, year-over-year sales growth of 10.5 percent.
• Nearly nine out of 10 counties — 44 of 51 — tracked by C.A.R. had a year-over-year increase in closed sales in June.
• Sales in 39 counties surged by more than 10 percent from last year.
• Mono had the strongest growth in sales from a year ago at 100 percent, followed by San Francisco (87.1 percent), and Del Norte (80 percent).
• Six of the counties with more than 100 percent growth rate had a median price above $1 million in May 2021.
• Six counties had a sales decline from last year, with Glenn dropping the most (-57.1 percent).

California Median Home Price

• In June,  four of the five major regions set new highs for median prices, with each region increasing by more than 20 percent from a year ago.
• The San Francisco Bay Area continued to have the highest year-over-year gain of 35.0 percent.
• Southern California was the second strongest growing at 30.3 percent.
• The Central Valley had the third-highest price growth rate of all regions with its median price increasing 23.8% year-over-year.
• The Far North had a growth rate of 22% year-over-year and the Central Coast region posted a growth of 20.8 percent.
• All 51 counties tracked by C.A.R. reported a gain in median price on a year-over-year basis.
• 47 of them reporting at least a double-digit growth rate from last June.
• Twenty-five counties set new record high median prices in June.
• Del Norte had the largest price gain of 48.1 percent.
• Lake had the smallest price growth of all counties with a 3.9 percent increase from June 2020.

California Housing Supply

• California's housing supply has continued to improve, with active listings reaching their highest level since October of last year.
• Housing supply normally rises during this time of year and continues to rise until late July or early August.
• The number of for-sale properties increased 15.4 percent from the previous month in June, as more homes were listed on the market.
• While new active listings were still down 12.3 percent from two years ago, they increased by around 8% month over month and year over year in June 2021.
• Almost all counties reported by C.A.R. saw a drop in active listings from last June, with 47 seeing a double-digit drop when compared to the same time last year.
• Marin had the biggest decline in active listings, plunging 59.0 percent year-over-year.
• Sutter (17.8 percent), Lassen (8.9 percent), and Stanislaus (0.5 percent) were the only counties in the state with an increase in active listings from the prior year.
• The Unsold Inventory Index (UII) dropped slightly from 1.8 months in May to 1.7 months in June but remained sharply below last year’s level.
• The index indicates the number of months it would take to sell the supply of homes on the market at the current rate of sales.

Median Days & Sales Price to List Price Ratio

• The median number of days it took to sell a California single-family home decreased to 8 days in June, down from 19 days in June 2020.
• C.A.R.’s statewide sales-price-to-list-price ratio posted a record high in June at 104.1 percent and was 99.5 percent in June 2020.
• Looking at sale-to-list percentages can help buyers and sellers get a sense of how to negotiate on pricing. The higher ratio of 100% or above shows a strong market favoring sellers.
• The statewide average price per square foot for an existing single-family home remained elevated.
• At $391, June's price per square foot was an all-time high.
• The price per square foot was $293 in June 2020.

Mortgage Interest Rate

• The 30-year, fixed-mortgage interest rate averaged 2.98 percent in June, down from 3.16 percent in June 2020, according to Freddie Mac.
• The five-year, adjustable mortgage interest rate was an average of 2.56 percent, compared to 3.09 percent in June 2020.

California Housing Market – Regional Sales and Price Trends – June 2021

At the regional level, all major regions saw sharp sales gains in June, with each region growing at double-digit from last year. The San Francisco Bay Area had the highest year-over-year increase of 34.1 percent, with seven of the nine counties increasing by more than 29 percent. In June, four of the state's five major regions set new record high median prices, with each region increasing by more than 20% from a year ago. The San Francisco Bay Area continues to grow at the fastest pace with a year-over-year gain of 35.0 percent.

These monthly and yearly trends numbers can be positive or negative depending on which side of the fence you are — Buyer or Seller? Home sales rebounded in June 2020 for the first time since the pandemic and California’s median home price reached $626,170, improving 6.5 percent from May and 2.5 percent from June 2019.

The monthly price increase was higher than the historical average price change from May to June and, in fact, was the highest ever recorded for a May-to-June change. Factors are businesses reopening, mortgage payments are falling, and some sellers are more ready and eager to sell. Sales remain strong in a traditional off-season and this year looks promising across the region.

It looks like 2021 will end with a new record at home sales and prices. All 51 counties tracked by C.A.R. reported a gain in median price on a year-over-year basis, with 47 of them reporting at least a double-digit growth rate from last June. Nearly nine out of ten counties — 44 of 51 — tracked by C.A.R. recorded a year-over-year sales increase in June. Whether you’re looking to buy or sell, timing your local market is an important part of real estate investment.

For sellers in the California housing market, it is a good time to sell. A low inventory would keep the prices from falling. Sales Price to List Price ratio has been 104.1% in June 2021. 70% of homes were sold above their initial asking prices on MLS. A seller would always prefer this ratio to be close to 100% or higher.

For buyers in the California housing market, it is a good time to buy. Low interest rates continue to fuel optimism for homebuying. The 30-year, fixed-mortgage interest rate averaged 2.98 percent in June, down from 3.16 percent in June 2020, according to Freddie Mac. Interest rates remain low giving buyers the purchasing power and home prices a boost. Fortunately, new listings have finally started to rise, which could help to sustain a higher level of home sales deeper into summer by providing much-needed supply.

All of these factors have led the market to optimism in homebuyers. Recent forecasts from industry groups like Freddie Mac and the Mortgage Bankers Association have predicted that the average rate for a 30-year fixed mortgage could stay within the low 3% range well into 2021.

Six California Metros Feature in The Top 20 Hottest Housing Markets 

Realtor.com takes into account market demand and the pace of the market to determine an area’s hotness. That is determined by the number of unique viewers per property and the number of days a listing is active on Realtor.com’s website. In their latest hottest housing markets report for March 2021, California had six in the top 20, more than any other state.

These hottest markets saw median listing prices 18.9% higher, on average than the national price in March. The report shows that spillover and secondary markets continue to dominate the list as buyers prioritize space while remaining close to major hubs.

Vallejo-Fairfield metro area was no. 3, with the median listing price of $550,000. It had the lowest median number of days on the market, at 11. It has been on the company’s top 20 list for the last several years. Other Northern California cities in the top 20 include Yuba City in Sutter County, which came in seventh place with a median listing price of $427,000.

The Santa Cruz-Watsonville metro area was No. 8, with a median listing price of $1.2 million, and Stockton-Lodi metro area followed at No. 9 with a median listing price of $468,000. The Modesto area came in at No. 12, with a median listing price of $499,000. And in the far northwest corner of the state, the Eureka-Arcata-Fortuna area came in at No. 18, with a median listing price of $439,000.

California Housing Market Forecast 2021-2022 (Latest Projections)

What are the California real estate market predictions for 2021 & 2022? California housing market is shaping up to continue the trend of the last few years as one of the hottest markets in the U.S. The median price of an existing single-family house in 2021 is expected to be $795,600, up 20.7 percent from the 2020 median. That is a $136,000 increase from last year – and an almost $300,000 increase over the last five years.

This year's home sales are expected to total 444,500, representing a 7.9 percent increase over last year's total and the biggest total in 12 years. As a result, despite some slowdown in sales in the second half of the year, CAR Deputy Chief Economist Oscar Wei predicts that prices will continue to rise. Active listings were down by at least 40% in the first five months of the year, but they are expected to grow in the summer and fall, when home buying slows and housing inventory rises. This will result in “normal” price and sales growth in the future.

Let us look at the price trends recorded by Zillow over the past few years. Since 2012, the California home values have appreciated by nearly 114% — Zillow Home Value Index. ZHVI is not the median price of homes that are sold in a month within a geographic region. It is calculated by taking all estimated home values for a given region and month (Also called Zestimates), taking a median of those values, applying some adjustments to account for seasonality or errors in individual home estimates.

It, therefore, represents the whole housing stock and not just the homes that list or sell in a given month. By this calculation, the current typical home value of homes in California is $654,629. It indicates that 50 percent of all housing stock in the area is worth more than $654,629 and 50 percent is worth less (adjusting for seasonal fluctuations and only includes the middle price tier of homes).

In May 2020, the typical value of homes in California was around $583,000. Home values have gone up 12.5% over the last twelve months. It can be said that California is currently the seller's real estate market which means that demand is exceeding the supply, giving sellers an advantage over buyers in price negotiations.

There are fewer homes for sale than there are active buyers in the marketplace. Buyer demand remains robust, which has been pushing home prices up by a double-digit rate of appreciation. Although the latest price forecast is not available earlier Zillow had predicted a growth of 10.6% in ZHVI by November 2021.

Courtesy of Zillow.com

Latest Weekly Trends & Forecast From California REALTORS®

CAR's latest weekly housing data for the week ending July 17, 2021, shows that since the recovery began, housing has been at the forefront of economic growth, but multiple indicators suggest that hot market conditions are driving the market to cool sooner than expected. Even though the overall level of existing single-family transactions is still falling from 15-year highs reached at the end of 2020, the housing market posted another large gain last month. Although home prices hit a new high of nearly $820,000 in June 2021, there were 28% more transactions than in June 2020.

After increasing for 53 weeks in a row, the number of existing single-family home sales fell for the second week in a row. C.A.R. had anticipated a slight softening of the market because mortgage applications had been trending downward for the previous six weeks and our monthly measure of pending sales fell in June for the first time since the recovery began. Fortunately, new listings are still increasing, which should contribute to a robust level of transactions in the second half of 2021, albeit at slightly lower levels than a few months ago.

California REALTORS® are not quite positive about the market as we move into the seventh month of the summer homebuying season. Only 32% (-21% from the previous week) of them expect sales to improve in the upcoming week, while nearly 33% believe prices will increase from the prior week. However, with the passing of the American Rescue Plan Act, the economic outlook is more positive than it was a couple of months ago when California was still under a lockdown.

The economy is slowly recovering. There was strong growth in employment in May & June and a surge in consumer confidence to the highest level in the year. California ended May with its 9th consecutive week with fewer than 100,000 new claims for pandemic and traditional unemployment insurance. With less than 65,000 new unemployment claims filed, last week also marks the smallest number of claims since March of 2020. As the economy is poised to reopen in the coming weeks, many of the service sector jobs, which bore the majority of the job losses, are expected to begin to recover.

Tight supply, however, remains a concern as it continues to hold back demand and continues to put pressure on affordability. Although the amount of new listings entering the MLS is still below normal levels, more sellers are putting their homes on the market, providing potential homebuyers with more options. The total number of active listings available for sale on the MLS has been steadily increasing over the last few weeks. This means that homebuyers will have more options when conducting their home search, and this trend is likely to be responsible for the slight increase in time on the market and the very slight decrease in competitiveness we've seen in recent weeks.

On the flip side, the economic recovery will continue to put upward pressure on mortgage rates. Rates are still below last year’s level though and they should remain so in July/August. With slightly more inventory on the market and an economy that is expected to gradually recover, buyer demand should begin to respond to the increase in purchasing power—especially if inflation fears cause would-be homeowners to fear higher interest rates in the future. In the short term, the 10-year Treasury note continues to support downward pressure on mortgage rates.

The 10-year was relatively stable at 1.37% last week, which is up slightly from the week before, but down noticeably from just a few months ago. Mortgage rates dipped last week to 2.88 and it was the third week in a row where rates came down. The number of new home purchase applications has fallen for the past two months consecutively even though interest rates have gradually fallen below 3% again.

Fewer California REALTORS® expect prices and listings to go up in the coming week. The results from the latest C.A.R. weekly survey suggest that nearly 33% (-9.6%) expect prices to go up next week. They believe housing demand is still stronger than normal so far in 2021, and tight supply will continue to put upward pressure on housing values.

Survey results also suggest that supply will remain tight as 42.3% of those who responded to the survey believed listings will increase in the following week, which is 8.9% less than last week. Therefore, robust price growth will not ease up until some balance between supply and demand is restored. Low interest rates, which are still low, could give buyers the purchasing power and home prices a boost.

California’s housing market forecast for 2021 is on the positive side but things could vary a bit, given the seriousness of the ongoing pandemic. Here's a rundown of the latest market trends.

• All parties involved – buyers, sellers, and agents – agreed that home prices will likely remain on their upward trend in the short term.
• 33.3% (-9.6%) of California Realtors® feel prices will rise in the coming weeks.
• 32.2% (-21.3%) think that sales will grow in the coming weeks.
• An average of 838 daily closed transactions was reported in the past week. That is up 3.2% week-over-week.
• An average of 947 contracts was signed per day in the past week. That is up 12.8% week-over-week.
• Seller's optimism continues to dip in the latest weekly trends. An average of 1023 new listings per day was reported in the past week, which represents a decline of -3.6%.
• About 42.3% (-8.9%) of California Realtors® think listings will be up next week.
• Interest rates always fluctuate, just as the real estate market does.
• We don’t see huge changes ahead in the coming months.
• They could fluctuate as more economic data become available throughout the year but the average 30-year fixed-rate average will likely stay close to 3 percent in 2021.
• A few months back, Zillow had predicted that home prices will rise by 10.6% until November 2021.
• Most California sub-markets saw big home-price gains in 2020.
• The same trend is being seen in 2021.
• All 51 counties tracked by the association reported a gain in median price on a year-over-year basis, as tight supply and heated market competition continued to put upward pressure on home prices.
• An ongoing shortage of supply is the main reason for price appreciation.
• With the cost of borrowing at historic lows, buying a home makes more sense than renting for many first-time buyers.
• For repeat buyers, there is an increasing desire for a larger second home.
• Affordability is at the Lowest Level Since Mid-2018, according to C.A.R.’s Traditional Housing Affordability Index (HAI).
• The percentage of buyers who could afford to purchase a median-priced home in California in the first quarter of 2021 dropped to 27% from 35% in the first quarter of 2020.
• The C.A.R.’s 2020 Annual Housing Market Survey finds that 39 percent of REALTORS^® who responded said their buyers are opting for a bigger home.
• This trend is likely to continue in 2021 as well.
• 35 percent said buyers are opting for a property with more rooms.
• 37 percent said buyers are opting to live in a suburb rather than a city.
• 26 percent said buyers are opting to live in rural areas rather than cities or suburbs.

Here's a rundown of the forecast released by CAR on April 27, 2021. 

This year, the California Association of Realtors’ economic forecast looks at several scenarios in predicting whether home prices and sales will rise or fall in 2021. Low mortgage interest rates and pent-up demand will bolster California home sales in 2021.

• The housing market still doing unseasonably well in 2021.
• Lots of buyer demand amidst all-time low rates.
• Time to get serious about supply & new construction impacting much more than just the real estate market.
• 2nd worst Jobs-to-Construction ratio in the nation.
• 2nd worst state for overcrowded housing.
• Ominous trends for the population and economy.
• In the previous forecast released in October 2020, the sales figure was projected to be 4.5 percent lower compared with the pace of 397,960 homes sold in 2019.
• However, the California housing market data closed unexpectedly above 2019's figures.
• Existing sales YTD were +3.5% above 2019.
• $717,930 record-setting median price in December.
• The CAR's latest forecast points towards an increase in existing single-family home sales by 11.2 percent in 2021.
• The California median home price is forecasted to edge up 8.0 percent in 2021, following an 11.3 percent increase in 2020.
• Low mortgage rates are expected to continue to fuel price growth.
• The average 2021 rate for a 30-year fixed-rate mortgage will be 3.0%, down from 3.1% in 2020.
• Housing Affordability Index is projected to be 27%, down from last year when it was 32%.
• Affordability will prevent many from achieving ownership.

Impact of COVID-19 on The California Housing Market (Summary)

Before the coronavirus outbreak, the declining interest rates bolstered February home sales and prices in the California housing market. The no. of home sales in February went up 6.6 percent from the 395,700 level in January, marking the first time in three months that sales jumped above the 400,000 benchmarks. February also marked the eighth consecutive month of year-over-year sales increases, according to the CALIFORNIA ASSOCIATION OF REALTORS^®.

According to a United States Department of Commerce report, the median price nationwide for a home sold in February was $345,900, up 6.3 percent from January. As the coronavirus pandemic hit the country, the sales activity in the California housing market took a sharp decline. Many buyers backed out of purchase due to coronavirus concerns. Due to the Covid-19 outbreak, the new California home sales also began to drop from March onward. Here's the review of the California real estate market from March onward.

Impact of COVID-19

The immediate impact of the coronavirus pandemic on the California housing market was that realtors canceled their open houses and half of all agents reported a drop in buyer interest. A flash poll conducted by C.A.R. between March 14-16 found that 54% of realtors had buyers who backed out from buying a home because of the coronavirus, and about 45% had sellers who backed out from selling a property. The pandemic further impacted the buying or selling of a house as California issued a statewide ‘stay at home’ order on March 19 to slow the spread of the coronavirus.

All non-essential businesses were essentially shut down. The real estate industry and many businesses that support it have been deemed non-essential. Real estate transactions like home buying, title research, residential leasing, and renting were allowed to continue. So were things like building maintenance and cleaning. Home construction was typically allowed to continue, as well. This meant that people could continue to live in their apartments and call the property manager to get the plumbing fixed.

Home sales and purchases already begun could be completed. However, it became much more difficult to arrange open houses or take photos of a property for sale. Some realtors adapted by setting up virtual showings of properties, whether it was via cell phone video, high-resolution photos, or drone. However, photographers can’t travel to properties, while stagers and appraisers can’t travel to homes that owners want to sell.

This froze the housing market for the most part due to shelter-in-place orders. Financial services were considered essential; this included banks and mortgage lenders. Unfortunately, the shutdown of up to 80 percent of the country means many are afraid to take out a home loan even if they still have a job. That is why mortgage applications fell by 30 percent in the last quarter of March 2020 while unemployment applications hit a record three million.

The U.S. Initial Unemployment Insurance Claims are that over 40 million people have already lost their jobs.

As new coronavirus cases were detected in California and the ‘shelter-in-place’ mandate was extended, a sharp sales decline increased unsold inventory – leading to a balanced real estate market. The COVID-19 pandemic kept both buyers and sellers on the sidelines in the California housing market. Many potential sellers delayed putting their homes on the market, which led to fewer new listings. Some buyers were excited and decided not to enter the market due to their weak financial condition. California home sales experienced the worst month-to-month sales decline in more than four decades.

According to C.A.R, home sales dropped sharply in April from both the previous month and year as the housing market began to feel the full impact of the state’s stay-at-home order.

This was because of a decline in open houses and home showings that are impossible to hold in such conditions.  Existing, single-family home sales totaled 277,440 in April on a seasonally adjusted annualized rate, down 25.6 percent from March and down 30.1 percent from April 2019. Additionally, sales in escrow were also delayed by the closure or limited availability of all the essential services related to a home sale.

The statewide median price remained above the $600,000 benchmark for the second consecutive month in April, price growth showed clear signs of softening when compared to the past six months. The April statewide median price of $606,410 for existing single-family homes in the state dipped 1.0 percent from March, and the 0.6 percent gain was essentially flat from April 2019, when the median price was $603,030. The year-over-year price gain was substantially smaller than the six-month average gain of 7.8 percent recorded between October 2019 and March 2020.

California home sales fell to the lowest level since the Great Recession as the housing market suffered the full impact of the coronavirus pandemic in May, according to a June 16 release by CALIFORNIA ASSOCIATION OF REALTORS®. As housing demand in California fell sharply in May, home prices also took a dip. The median home price fell below last year’s price for the first time since February 2012 and breaking the state’s 98-month year-over-year price gain streak.

All major regions dipped in sales by more than 35 percent from last year. The Bay Area and Central Coast dropping the most at -51.1 percent each. Southern California home sales dropped by -45.6 percent, and the Central Valley by -36.6 percent. Existing single-family home sales were down by 13.9 percent from April and down by 41.4 percent from May 2019. May’s statewide median home price was $588,070, down 3.0 percent from April and down 3.7 percent from May 2019. Year-to-date statewide home sales were down 12.9 percent in May.

Median prices continued to dip in May from last year in the Central Coast and the Bay Area but inched up slightly in the Central Valley region. The median home price was virtually unchanged in Southern California. The unsold inventory index jumped to 4.3 months in May from 3.4 months in April and was up from 3.2 months in May 2019. Total active listings continued to decline on an annual basis for the 11th consecutive month.

The 34 percent year-over-year decrease in listings was the biggest drop since March 2013. The median number of days it took to sell a California single-family home dipped to 17 days in May from 18 days in May 2019. C.A.R.’s statewide sales-price-to-list-price ratio was 99.7 percent in May 2020, up slightly from 99.3 in May 2019.

After the California real estate market suffered its worst month in 13 years, California’s Realtors and landlords saw a big rebound in June. The housing markets in Los Angeles, San Francisco, San Jose, San Diego, and Sacramento saw the biggest recovery. Home Sales were up 42.4 percent from May and down 12.8 percent from June 2019. The luxury market suffered the most with more than 50% drops in sales. Sales Price to List Price Ratio of 99.5% in June means homes are selling very close to their listing prices.

June’s statewide median home price was $626,170, up 6.5 percent from May and up 2.5 percent from June 2019. Throughout the state, single-family home prices rose 6.5% to $626, 170, or a rise of $38,000 from the previous month. Sales grew 42.5% from May. California condo prices rose 4.6% and month-to-month sales increased by 68.5%. Condo prices have risen 4.6% YoY while sales slumped 16.2%.

The return in the COVID-19 cases remains a concern across the nation as well as California, and it may hinder the recovery of the housing market in the second half of 2020. Meanwhile, the lowest ever mortgage rates have been able to increase buyer activity, which in turn may help to sustain the rise in sales in the coming months.

After falling to the lowest level since the Great Recession, continued to improve in August as home sales climbed to their highest level in more than a decade. The median home price broke last month’s record and hit another high, according to the September 16 release by C.A.R.

Existing, single-family home sales totaled 465,400 in August on a seasonally adjusted annualized rate, up 6.3 percent from July and up 14.6 percent from August 2019. August’s statewide median home price was $706,900 up 6.1 percent from July and up 14.5 percent from August 2019. Year-to-date statewide home sales were down 6.8 percent in August.

In September, the California housing market outperformed expectations, breaking a record high median price for the fourth straight month. Existing, single-family home sales totaled 489,590 in September on a seasonally adjusted annualized rate, up 5.2 percent from August and up 21.2 percent from September 2019.

September’s statewide median home price was $712,430 up 0.8 percent from August and up 17.6 percent from September 2019. Year-to-date statewide home sales were down 3.7 percent in September. The home price exceeded the $700,000 mark for the second consecutive month.

Existing, single-family home sales totaled 484,510 in October on a seasonally adjusted annualized rate, down 1.0 percent from September and up 19.9 percent from October 2019. October’s statewide median home price was $711,300 down 0.2 percent from September and up 17.5 percent from October 2019. Year-to-date statewide home sales were down 1.3 percent in October.

Existing, single-family home sales totaled 508,820 in November on a seasonally adjusted annualized rate, up 5.0 percent from October and up 26.3 percent from November 2019. November’s statewide median home price was $699,000 down 1.7 percent from October and up 18.5 percent from November 2019. Year-to-date statewide home sales were up 1.3 percent in November.

Existing, single-family home sales totaled 509,750 in December on a seasonally adjusted annualized rate, up 0.2 percent from November and up 28 percent from December 2019. December’s statewide median home price was $717,930, up 2.7 percent from November and up 16.8 percent from December 2019. For 2020 as a whole, sales of existing statewide homes were up 3.5 percent from last year.

Existing, single-family home sales totaled 484,730 in January 2021 on a seasonally adjusted annualized rate, down 4.9 percent from December and up 22.5 percent from January 2020. January’s statewide median home price was $699,890, down 2.5 percent from December and up 21.7 percent from January 2020.

Existing, single-family home sales totaled 462,720 in February 2021 on a seasonally adjusted annualized rate, down 4.5 percent from January and up 9.7 percent from February 2020. February’s statewide median home price was $699,000, down 0.1 percent from January and up 20.6 percent from February 2020, according to C.A.R.

Existing, single-family home sales totaled 446,410 in March 2021 on a seasonally adjusted annualized rate, down 3.5 percent from February and up 19.7 percent from March 2020. March’s statewide median home price was $758,990, up 8.6 percent from February and up 23.9 percent from March 2020. Year-to-date statewide home sales were up 17.1 percent in March.

Conclusion

The most important thing to remember is that it is a health crisis – not an economic one. This pattern differs from a standard economic recession, which is a situation in which economic activity falls for 6-18 months and then recovers more slowly. Due to a wave of job losses nationwide, this will create many distressed home sellers in the California real estate market. Yet this is a buying opportunity for investors who have financing.

The slowdown in what is normally a busy season will cause some realtors to go out of business. Mortgage brokers and lenders will experience a boom in business since record low-interest rates cause a spike in mortgage refinances. We’ll also see a flurry of activity in the California real estate market as people pick up where they left off. For example, those who wanted to move before school starts in the fall aren’t going to wait another year to see what the housing market is going to do.

They’ll rush to showings and try to close on a property, as long as their personal financial situation is stable. We can expect the summer of 2021 to see record activity in the California housing market due to the standard spike in real estate transactions before the school year starts.

On top of this are the young graduates and couples that want to buy their own homes. Plus there will be long-term renters who recognize the opportunity that low mortgage rates represent, searching for homes once they can be pre-approved for a mortgage and visit properties.

There will be a slower economy for a while, but several ongoing trends aren’t going to reverse themselves. Millennials will want to move out of their parent's homes and into their own. We can’t say there will be a coronavirus-led baby boom, but many families having been stuck inside with their kids will decide they want a larger home, yard, or both.

We can talk about the many people who’ve moved out of California to other states. Yet the state continues to attract immigrants from around the world. And young native-born Americans flock here for high-paying jobs, as well. That isn’t going to change due to the virus. Tech giants expanding to Seattle or Portland haven’t relocated their development hubs out of Silicon Valley.

Furthermore, the demand for rentals in the California housing market remains strong. This is why we don’t expect to see a decline in monthly rents, though housing prices may fall significantly before shooting back up. A secondary effect of the coronavirus outbreak is that it has crimped supply chains around the world and slowed down construction.

This will drive up the value of both new and existing properties in the California housing market since the supply of new and redeveloped properties has been stifled. And there is certainly the possibility the California housing market will see bidding wars on the few available and desirable properties by people who have more margin thanks to historically low mortgage rates.

We can expect a few shifts in the California housing market long-term. Realtors will probably continue to utilize 3D virtual tours, using 360 cameras to capture images of every room in the house. This helps them sell the home 24x7x365, whether or not everyone is stuck at home.

While appraisers, stages, and construction crews can’t work remotely, we can expect far more back-office work in the real estate industry to be done remotely because that’s become commonplace. We can also expect online contract reviews and digital signatures to become the norm because it allows real estate transactions to move forward through some of the participants are at home.

Demand for housing was very strong before the coronavirus hit the U.S. This pandemic is not expected to last nearly as long as the United States subprime mortgage crisis, which was a nationwide financial crisis, occurring between 2007 and 2010.

The sharp sales drop in May was the steepest we’ve seen but there are encouraging signs that show the market is recovering and should continue to improve for the remainder of 2020.

Some of the realtors saw no decline in their businesses even during the peak of the pandemic. According to them, the real estate sector was really active even in the pandemic. The way of operating business has changed. People are working from home. They are using applications like FaceTime to show buyers homes instead of traditional open houses.

Lenders experienced a surge in demand as opportunistic buyers move to take advantage of low mortgage rates. Brett Jennings, the founder of Real Estate Experts, writes, “our market is still thriving” in Santa Clara County, seeing only a few cancellations despite shelter-in-place conditions and the fact that “we have one of the highest counts of active COVID-19 cases in California.”

According to Dr. Svenja Gudell, the chief economist of Zillow Group, when they examined pandemic histories ranging from the 1918 flu epidemic to the 2003 SARS outbreak, they noted that economies “snapped back quickly once the epidemic was over.”

Residential real estate is likely to fare far better than the commercial real estate sector. Sometimes, you have to take advantage of these market disruptions to see that many investors will pump the brakes on investing out of fear and other illogical emotional reasons, while others see the opportunity of having access to more real estate inventory, possibly better pricing, and still historically low-interest rates.

References/Data Sources

• https://www.car.org/
• https://www.car.org/aboutus/mediacenter/newsreleases
• https://www.car.org/marketdata/data/countysalesactivity
• https://www.car.org/marketdata/marketforecast
• https://www.car.org/marketdata/marketminute
• https://www.car.org/marketdata/interactive/housingmarketoverview
• https://www.zillow.com/ca/home-values
• https://lao.ca.gov/LAOEconTax/Article/Detail/265
• https://sf.curbed.com/2020/3/23/21188781/sf-housing-market-coronavirus-covid-19
• https://www.ppic.org/publication/new-patterns-of-immigrant-settlement-in-california
• https://fox40.com/news/business/local-real-estate-market-slows-amid-covid-19-pandemic
• https://www.point2homes.com/news/us-real-estate-news/experts-california-real-estate-2020.html
• https://www.washingtonpost.com/business/2020/02/27/mortgage-rates-head-back-down-coronavirus-fears
• https://www.cnbc.com/2020/03/18/weekly-mortgage-applications-drop-over-8percent-as-interest-rates-jump.html
• https://www.usnews.com/news/business/articles/2020-03-25/business-fallout-companies-in-china-see-delays-in-reopening
• https://www.dallasnews.com/business/real-estate/2020/03/25/homeowners-who-cant-pay-their-mortgages-are-getting-help
• https://www.wfsb.com/news/businesses-considered-essential-under-stay-safe-stay-home-policy/article_53f8e0d0-6d17-11ea-a04d-57ecbb72c518.html