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Home prices on the rise in Cobb, but sales are slowing

  • Ricky Leroux
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  • Feb 11, 2019
  •   EmailHousing chart

This chart shows the median home sales price in Cobb from January 2017 to December 2018 according to data from Realtor.comFacebookTwitter

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The median sales price for homes sold in December was $283,500, up 7 percent from the $265,000 median sales price in December 2017. Nationally, median sales prices are up about 2.1 percent over that same period.

“Home sales continue to cool in greater Atlanta but at a faster rate than the national average,” John Rainey, vice president of RE/MAX Georgia, said in a statement. “However, the median sales price for the region is increasing at double the average nationally. Both are (effects) of very low inventory. While greater Atlanta is moving towards a balanced market, low inventory and affordability are slowing down the much needed balancing of supply and demand.”

Meanwhile, the median sale price for a home in Cobb County has increased about 14.7 percent over the last two years — from $224,500 in January 2017 to $257,400 in December 2018, according to data from Realtor.com.

Lawrence Yun, chief economist for the National Association of Realtors, said a decline in home sales can be attributed in part to higher interest rates in 2018.

“The housing market is obviously very sensitive to mortgage rates,” Yun said. “Softer sales in December reflected consumer search processes and contract signing activity in previous months when mortgage rates were higher than today. Now, with mortgage rates lower, some revival in home sales is expected going into spring.”

Roger Tutterow, economics professor at Kennesaw State University and director of its Econometric Center, said during his 2019 economic forecast that Cobb’s housing market looks “very good” but it’s not going to grow at the same pace as it did in the 1980s or 1990s because the county simply doesn’t have as much available space.

“(In) the 1970s and ‘80s and ‘90s, we had an unlimited supply, it seemed, of land to develop,” he said. “We are a maturing county. We are seeing less and less large developments and more smaller developments, more infill. We’re seeing activity now in south Cobb, where we’re taking more mature neighborhoods and we’re revamping them, we’re bringing them back to life.”

Still, Tutterow said, that doesn’t mean there aren’t issues in the real estate market, particularly when it comes to affordability.

“I do worry about the highest price points in the detached single-family homes because for the first time in this expansion, we’re getting back from customers and realtors that affordability is a word they’ve heard tossed around,” Tutterow said.

Affordable housing is an issue some state lawmakers from Cobb raised when discussing the upcoming legislative session with the MDJ in December.

“It is a huge issue,” said state Rep. Teri Anulewicz, D-Smyrna. “And I remember lamenting to a friend of mine that, you know, all these new cities are coming online, and Smyrna was losing a lot of police officers (and) firefighters to these new cities. They could pay more. … Most of our public safety officials or public safety employees live out in Paulding (or) Cherokee (counties). They’re driving in a ways. That’s why take-home cars are such a big deal. It is a major issue, and I think to address it it’s going to have to be a real collaboration between state, county and local folks so we can come up with some solutions.”

Anulewicz said a Florida program called the Sadowski Act has worked well to address the affordability issue. The act, signed into law in 1992, uses taxes on real estate transactions to fund state and local housing programs.

“My sister was a school teacher in Pensacola, and she was able to afford to buy a house in Pensacola and the area where she taught through a mortgage through this program,” Anulewicz said. “And so I think there are ways that we can approach this, but I think it’s going to have to be a collaborative effort. I don’t think the state can do it alone, and I certainly don’t think the cities or the county can do it.”

State Sen. Michael Rhett, D-Marietta, suggested Cobb look at programs used by the city of Atlanta to provide incentives for police officers to live in the communities in which they work.

State Rep. Ed Setzler, R-Acworth, disputed the premise of the question of affordable housing.

“People who say that we have a shortage of affordable housing don’t know the whole county. If you were to come to Kennesaw, on Baker Road, and drive to some neighborhoods that have 1,800-square-foot, three bedroom, slab-on-grade homes, you can still buy those homes for $150,000. … There is affordable housing in Cobb County,” Setzler said.

The Acworth Republican then alleged that there may be a political motivation involved in bringing more affordable housing to Cobb.

“What you’re seeing though is, I believe, you see people … who have a motivation to try to insert and jam in more density in Cobb County, and I think they’re missing the opportunities that exist today. I think it’s based on … some faulty premises. … So there is affordable housing, particularly (thanks to) low interest rates, in Cobb County, but it is an ideological push to jam density in here and change the face of Cobb.”