Atlanta's Housing Market Fuels Multifamily Rental Demand
In spite of Atlanta's rent increases ranking the fifth-highest in the nation, Atlanta remains more affordable to renters.
Since home prices bottomed out in 2012, housing prices have risen at twice the rate of overall economic growth, which also means home prices have outpaced wage growth. Home prices in metro Atlanta rose 8.7 percent in the past year which is stronger than the national pace of 6.2 percent. This is keeping some people from becoming homeowners, which is fueling rental demand.
The rental market is expanding largely because of what is happening in home sales, where it is harder in Atlanta for first-time buyers to find an affordable "starter" home. According to Aaron Terrazas, Zillow senior economist, "With home prices continuing their rapid climb, it's becoming more and more difficult for renters to become owners, forcing them to rent longer than they otherwise would have."
The result is a market that is great for selling a home, but a potential problem for would-be homebuyers. This squeeze on affordability also keeps more people in the rental market, adding to demand. Rents in Atlanta have climbed 35.1 percent since 2010, according to RealPage.
Rising Single Family Home Prices
Average home price increase, past year*:
National average: 6.2% City of Atlanta: 6.5%, Metro Atlanta: 8.7%
* Not including newly built homes
Read More Here: Atlanta Rent Growth Among Nation's Fastest, Atlanta home prices increase faster than the national average, Atlanta-area home prices climb faster than nation's, S&P Core Logic Case-Shiller Index