The Metro Atlanta housing market has long stood out for its housing affordability, especially when compared to similarly sized metropolitan areas.
Recent studies, though, suggest that Atlanta is becoming a far less affordable place to live, and below, we have highlighted three statistics to demonstrate that fact:
1. High-End Dominance in Atlanta – Of the multifamily developments in Atlanta that were completed in 2015, an incredible 95 percent were high end, luxury developments, according to a recent RENTCafé analysis. That is far above the 79 percent national average, and the 78 percent average for the Southern region.
2. High-End Rise in Atlanta – Along with nearly all of Atlanta’s multifamily development going towards luxury units, the sheer number of those luxury developments is also stunning. The same RENTCafé report found that 29 luxury multifamily developments hit the Metro Atlanta market in 2015, an 867 percent increase over the three developments in 2012; as our chart below shows, only Charlotte saw a larger 2015 increase.
|Metro Area||High-End Properties in 2012||High-End Properties in 2015||Increase from 2012 to 2015|
|West Palm Beach/Boca Raton||1||7||600%|
3. High Rising Rents in Atlanta – Most alarming of all is the paradoxical nature of Atlanta’s housing market. According to a detailed analysis from the Atlanta Federal Reserve, just as Metro Atlanta has added high-cost rental units, it has lost a considerable number of affordable units. From 2010 to 2014, the Fed found, the number of housing units with rents less than $500 declined 17 percent, while units with rents from $500 to $750 declined 15.7 percent; meanwhile, the inventory of units with rents of $1,500 or greater rose 56.4 percent. Because of that trend in Atlanta and other Southern cities, the region has seen median rents climb 23.4 percent in just the last three years, while wages have grown roughly 3.1 percent.
That final statistic is key, because it demonstrates why Atlanta’s trend towards expensive luxury rental units is so concerning. The more that consumers are paying in rent, the less money they can save for a home purchase – and as recent Freddie Mac research found, the homeownership rate has been adversely affected by abnormally high rents.