You're an oiut of state investor looking at a city with a significant condo surplus - and that's not including the shaow inventory. The condo market will be saturated for years, including when you try to sell it. In the meantime you'll be paying through the nose every month, be chasing rents, doing repairs and hoping for limited vacancy.
Successful investors are far and few between in this market - and the ones that are solid are in it full time. This is a sucker bet right now for distant owners or part time "investors". Just my two cents from being deep in it around here since '93.
Thumbs up to Chuck for a good answer.
Hank - there is no success in the onesy-twosey approach from CA to GA, is there?
I talk to out of state investor candidates often - I talk to my own clients and friends often - about $25000 to $100,000 condos, lofts and townhomes, and every other real estate investment under the sun and I know that the obstacles to success in:
1. Atlantic Station
are plentiful and quite obtrusive.
Here's what Atlanta real estate expert Steve Palm recently stated on 7/31 about condos, lofts and townhomes...he doesn't write for a "local paper," but hear him out nonetheless...he writes a monthly letter to the FMLS members and he creates charts and graphs that explain exactly where we are based on recent FMLS data:
"The average sale price in July 2011 for single family attached was $125,161. This is a decline of 11.8% over July 2010 and the 14th consecutive year-to-year monthly decline. Single family attached has experienced a year-to-year decline for average price in 43 out of the last 46 reporting periods."
I wonder if the "local paper" knows about this trend?
I wonder if that "local paper" has seen Steve's FLATLINED graphs for condo, loft and townhome median prices that go back to 1990?
Gaurav - you can buy a decent single family rental house or multiplex within ten minutes of Georgia Tech for prices ranging from $3000 to $300,000. You probably should not buy a condo. With good operations and sound purchasing fundamentals, the CA to GA real estate connection can be very successful.
Is "this" a good time? YES, for many buyers "this time" truly is..."this" could be a good time for you, but starting with "condos" and "Atlantic Station" is a recipe for peril if you are doing "this" as an absentee landlord...
So, broadly speaking, can someone please show me a scenario for success renting one unit and doing it from CA? Donâ€™t forget to include selling the unit and all thatâ€™s involved on that side. I'm not being sarcastic, I'm serious.
If you have connections in the Area, or you have a really good property management company that you can work with then it is a Great Time to buy.
If you do not have those ties or connections to the area, it is really hard to maintain an investment property when you are on the opposite coast.
Steve - I agree with just about all of what you said. I'm not against developing real estate assets as PART of an investment portfolio - I am against going in uneducated to the process. We have little to disagree about but it needs to be drilled home that real estate is by it's nature, a singularly unique entity; every deal has to be carefully reviewed.
The idea that agents ill equipped to do this think they can is scary for their clients.
Gaurav do yourself a favor - if you want to be a landlord do it out there where you can get a toe in the water to see how it feels. Doing it here will cost you a leg and probably more; you will ripped off and be unable to do anything.
Oh - here's the latest from the local rag in atlanta - I stress latest because these headlines are commonplace - "Atlanta police are investigating the armed robbery of a Georgia Tech student in a neighborhood just north of campus....The male student was robbed at gunpoint around 11:30 a.m. Wednesday while walking near the intersection of Calhoun and Center streets, in the Home Park neighborhood where numerous other students have been accosted in the past couple of years"
Yeah I know, it's a big city...blah blah blah.
Stay home and try this where you live....if you get it going then look to expand.
I would stay away from buying a condo as an income property here in Atlanta personally. I say this because Atlanta is not exactly a condo town like say in California, New York, or Philadelphia. People generally like there space here. Wether it is Intown with some yard space or the Atlanta metro area where people love a lot of yard space. The idea of condo living although not new to Atlanta is still a fairly new thing here. Also think about the possible resale. You might have a hard time depending on the numbers for whenever you would like to sell. As an income property I would say look for a home near the campus. You possibly could get more bank for your buck.
Good luck on your choice! Feel free to contact me if you have any questions.
Keller Williams Intown Realty
621 North Ave. NE, Suite C-50
Atlanta, GA 30308
Direct #: 678.656.5524
Now is an excellent time to invest in income producing rental property in the Atlanta metro area and in particular in the area around GA Tech. I agree that this is a great neighborhood for rental property for students and young professionals who work and play in the Midtown area. Midtown is a huge office submarket in Atlanta and there are many major employers located very close by including Turner Broadcasting, Coca Cola and the Universities (GA Tech and GA State) to name a few. There are also a myriad of professional service firms such as law firms and CPA firms in the Midtown area. I agree that you may want to consider single family homes and town homes in addition to condos. It just depends upon what you like and feel will provide you with the best return and exit strategy. Also, many condo association bylaws and covenants restrict the number of rental units in the community, so it may be difficult to find condos that you can purchase now and immediately put on the market for lease. I work with many investor clients (many of whom are out of state and overseas) and also provide property management services. Feel free to call me to discuss this further at your convenience.
Best regards and good luck,
Diversified Real Estate Consulting, LLC
This is a great time to purchase. I would suggest you get acquainted with the rules of the HOA. Sometimes they can be sticklers. I have one for sale in Virginia Highlands that is roughly 5-10 minutes from Tech, and many of them are used as rentals and its priced right. Let me know if I can help