Atlanta Leads Nation in Housing Supply Growth

Atlanta’s housing market just notched another milestone, this time on the supply side.

The metro area’s active home listings increased 41.6 percent year-over-year last month, the largest such jump in the nation, the Atlanta Business Chronicle reported, citing CoStar data. There were 25,812 homes listed for sale across the metro in May, up more than 7,600 from the same time last year.

May was Atlanta’s 15th consecutive month of supply increases and propelled it to the third-highest number of active listings in the country, trailing only Dallas and Houston. Phoenix and Chicago round out the top five.

The surge represents a significant swing from the height of the pandemic-fueled housing frenzy, when Atlanta’s supply dropped below one month of available inventory, according to First Multiple Listing Service. Last month’s total translates to 4.6 months of supply, the closest the region has come in over a decade to hitting the six-month threshold that typically signals a balanced housing market.

Local brokers attribute the shift in part to the easing of the so-called “lock-in effect,” where homeowners have been reluctant to sell and lose historically low mortgage rates. The increase in listings reflects more movement in the market, even if buyer momentum has yet to fully follow, said Kristen Jones, broker-owner of Re/Max Around Atlanta.

That caution among buyers is also reflected in the data: Metro Atlanta had the highest share of canceled home sale transactions in the nation last month, as affordability challenges and economic uncertainty weighed on dealmaking, according to Redfin.

If supply growth continues and rates stabilize, the region could enter a more favorable market for both sides of the transaction, something Atlanta hasn’t seen in years, analysts say.

Nationwide, available home supply rose 17.2 percent year-over-year in May, less than half of Atlanta’s pace. The city’s inventory gains offer some relief to buyers who were boxed out in previous years, but rising prices and borrowing costs are keeping many on the sidelines.

— Judah Duke