We kicked off the week talking about the economic challenges facing metro Atlanta and the region’s need to adapt to suit the modern real estate marketplace.
Yesterday, we got a rather harsh confirmation that change is indeed necessary. According to the latest S&P Case-Shillernumbers, housing prices in the 20 largest metro areas fell by 3.5 percent from February 2011 to February 2012.
In the 28-county metro Atlanta region, however, the year-to-year price decline was 17.3 percent, easily the largest drop in the nation. The decline was twice as large as that in Las Vegas, the second worst-performing metro region in the country.
As the Case-Shiller analysts put it:
“Phoenix and Atlanta stand out this month in terms of their contrasting relative strength and weakness in the early 2012 housing market. At one end of the spectrum, we have Atlanta posting a double-digit, and lowest on record, annual rate at -17.3%. Atlanta has now recorded five consecutive months of double-digit negative annual rates and seven consecutive monthly declines. On the other hand, Phoenix has posted two consecutive months of positive annual rates, with its latest being +3.3%, and five consecutive positive monthly returns.”
Five years ago, housing values in Atlanta were comparable to those in Charlotte, Dallas, Denver and Cleveland. In fact, Atlanta was a close second to Denver among those five. But as the chart below documents, that’s no longer the case.
I don’t think you can look at that data and shrug it off as a momentary blip. It’s also not the inevitable consequence of the larger national economic situation. This is a long-term problem, and it’s a metro Atlanta problem.
– Jay Bookman