This year is shaping up to be a revolutionary one for Atlanta homebuilding. According to the latest analysis from Dodge Data & Analytics (a leading housing indicator), residential construction spending in metro Atlanta totaled roughly $6 billion during 2015—a 15 percent increase from 2014, vaulting us ahead of previous construction meccas like Chicago, Seattle, and San Francisco. We are now the ninth-largest metropolitan area in the country.
New jobs play a major role in the continued growth of Atlanta’s housing market. According to the U.S. Bureau of Labor Statistics, Atlanta had the fastest rate of job growth among the 12 largest metro areas in the 12 months ending in November 2015. In December our unemployment rate declined to 4.9 percent—the lowest since December 2007.
With real estate now in full recovery mode, condos and townhomes are becoming desirable again. Midtown’s growth reflects residents’ desire to live near MARTA stations and have access to walkable streets with cultural amenities such as the Woodruff Arts Center and Georgia Tech. Potential homeowners want to enjoy the shopping, restaurants, arts, and parks along the Atlanta BeltLine, which has spurred high-end condos and townhomes nearby. And the city’s outskirts are also getting in on the act as new spec-home neighborhoods are popping up in surrounding counties.
There has been a surge in newly built rentals as well. There are more than a dozen midrise apartment projects planned on Peachtree, West Peachtree, and Spring streets, as well as near MARTA stations, Piedmont Park, and Technology Square. Midtown has never seen so many proposed residential projects at once, and more continue to enter the market.
It all leads to the question: Will all of this new construction reverse Atlanta’s low housing inventory that started in 2013? According to Curbed, homes for sale in mid-2013 were down by a crippling 30 percent from the previous year. Perhaps the rise in new construction will put a Band-Aid on things for the short run. But if our population continues to grow faster than our inventory, our home prices may soon match other large cities. The average price per square foot reigns at $920 for San Fran or a breathtaking $1,455 for New York—compared with Atlanta’s current average of $179 per square foot. That prospect alone makes the banging and clinking sounds of new construction a little more tolerable.
Egypt Sherrod is the host of HGTV’s highly rated Property Virgins and the new Flipping Virgins, CEO of the Egypt Sherrod Real Estate Group, and author of Keep Calm . . . It’s Just Real Estate: Your No-Stress Guide to Buying a Home.
This article originally appeared in our Summer 2016 issue of Atlanta Magazine’s HOME.