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Metro Atlanta is a great petri dish for studying the issues of over building in a large market seems bad but the real issues are in the micro markets. Atlanta is a city with no physical boundaries so the growth has been in all directions and backfilling some of the poorer area’s that have been overlooked.

Where Atlanta is seeing their biggest inventory issues are the outlying counties that have lots of small home developments aimed at low income borrowers. Areas such as South Fulton county saw tremendous growth in low end housing that targeted the historically renting community. The homes are small, close together with small plots, and financing was very easy.

The problem is when the subprime market dropped out and the original ARMs started resetting there is no one to buy the homes and people are just leaving the ones that are built. So Atlanta’s housing crunch is not too bad in most sections, but outlying suburbs and low income areas with lots of new development the market is falling apart. Lots of micro market damage in a large metropolitan market.

Throughout metro Atlanta, agents and brokers are reporting slowed sales and rising inventories of unsold houses, even as national reports indicate month after month of falling sales and prices now projected to last well into 2008.
Harvard’s Joint Center for Housing Studies reports that the current national oversupply of unsold houses would take two years to sell off.
Metro Brokers GMAC agent Katrina Wood said she works closely with sellers now to negotiate the tricky choices the soft market imposes.
“Are you willing to list your home slightly below the market value in order to make the sale?” she asks them. “Some sellers are not willing to do that and some are.”
From May 2006 to May 2007, inventories of unsold houses in metro Atlanta soared in every county, climbing between 18 percent and 70 percent in just one year, depending on the area.  ajc.com.

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