For real estate agents, putting your finger on the pulse of your local real estate market can be a difficult task. Determining which factors are driving growth in your region is important to your business and it can be a daunting task at times.
One of the best predictors of patterns in many larger markets can be a view of activity in other markets. One example is Atlanta, long considered one of the most affordable large metro areas in the country. Factors driving growth in the market include the schools, Millennial renters and homebuyers, number of moves by residents and inventory levels.
According to RealtyTrac, in 2016 the typical Fulton County homeowner spent about 25.8 percent of their income on housing. That is below the one-third portion of income experts say typically is earmarked for housing.
Metro Atlanta, including Fulton County, has two things going for it. The area has affordable housing, and it also features urban and suburban options. For agents, this is a key factor in being able to keep millennials in the area as they transition from renters to homebuyers.
According to Lawrence Yun, chief economist for the National Association of Realtors, while millennials may choose to live in an urban area as renters, most aren’t staying once they’re ready to buy.
“The median age of a millennial homebuyer is 30 years old, which typically is the time in life where one settles down to marry and raise a family,” he said. “Even if an urban setting is where they’d like to buy their first home, the need for more space at an affordable price is for the most part pushing their search further out.”
At 87 million strong, millennial buyers are the largest demographic in the nation, and their influence reaches not only real estate but all consumer buying decisions. The millennial generation is propelled by success and an increase in income. Understanding the factors that affects their buying decisions will help real estate agents make good decision about millennials and real estate needs.
And in Fulton County, millennials can transition from downtown Atlanta to suburbs without leaving the region, a key benefit for agents.
Many millennials are also starting families, and schools are also important. During a real estate search, they are less likely than other generations to compromise on school districts, according to a Realtor.com survey. Fifty-two percent of millennials said the quality of a school district could be a deal breaker in their search for the perfect home, compared with 31 percent of all buyers.
And the proof is in the numbers. According to the U.S. Census Bureau, 90,650 people were added to Atlanta’s population in 2016.
Another key factor for agents in Atlanta is the impact the rental market is having on home sales, with a number of rental units coming online at the same time.
Coldwell Banker Atlanta’s Top Previews International Luxury Property Specialist Marc Castillo said this could create issues for home sellers in 2017.
“A glut of rentals would be a welcome relief to many who found the rental market unreasonably tight this year,” he said. “But an increase in rental inventory may have a cooling effect on condos. In a tight rental market, renters start to see a benefit in buying as a relief to high rental prices.”
There is a segment of the millennial population that doesn’t like to be tied down and likely wouldn’t consider purchasing a home.
Demographics will continue to play a factor in Atlanta’s real estate market. For agents, these also are the issues to be aware of in your market.
