Home Buying in Atlanta>Question Details

Shawn, Home Buyer in Hackensack, NJ

How is the rental Market in Downtown Atlatna?

Asked by Shawn, Hackensack, NJ Wed May 14, 2008

I am currently live in NJ and between High cost of owning and the High taxes, I have been thinking buying a place to rent somewhere else like Atlanta. I just want to hold on to it for a while (years) . I don't think i would live there, just rent it.
Is there a market for this now?
My rent is pretty cheap and I'm good area, I just don't want to let another buyers market come and go.

I was told i am preapproved for 150,000

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Answers

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I agree with pretty much everything Lee said, but there are some good options out there for you in this price range, that will cover your mortgage and then some by leasing it. Buying a HUD house (an FHA foreclosure) or a foreclosure or short sale in the right neighborhood would be your best option.

For example there's a foreclosure on the Memorial-side of Grant Park currently listed for $82k, that was bought for almost double that 3 years back. It's listed as a three-bedroom, but is really a 2 bedroom, and needs some fresh paint, washer/dryer, the carpet replaced, and a good scrub. Then you could probably rent it out for about $1000-$1200 a month. Great buy, in an appreciating area. However, as I write this, I'm sure the bank is receiving half a dozen offers.

If you're going to go the foreclosure/HUD/short sale route, you need to be flexible (closings tend to get pushed around), and unattached (because you'll probably loose a few before you win one), and ready to move quickly (because good deals in good areas get scooped up fast).

Areas where you have a good chance of swooping in on a pre-foreclosure, foreclosure, HUD, or short sale that are highly desirable areas for Renters: Grant Park, Ormewood Park, Edgewood, Reynoldstown, Kirkwood, and East Atlanta.

Atlanta has the highest surplus of HUD owned homes/condos in the nation, and I am part of one, of 28 Agencies in Georgia, certified to show and sell HUD homes. So, if you need any assistance in that department, I'd be more to speak with you one on one about that.

Also - As of May 20th, Georgia is going to be one of 17 states listed as a "declining market." Therefore, almost every Mortgage Broker/Bank is going to require that you bring some money to the table for a conventional loan. Currently I've heard, 10% down for personal property (possibly 8% for single family & 10% for condos), and 15-20% for investment property (it all depends on the individual company/bank). The only loop hole to this after the 20th will be to qualify for a FHA loan. If you have any questions the declining market or FHA loans, then you can contact me individually about that as well.

Great question & good luck!


Sarah Turner
Realtor
sarah.turner@yourownsanctuary.com

Sanctuary Real Estate, Inc.
300 North Highland Avenue Suite B | Atlanta, GA 30307
T: (404) 688-3363 | F: (404) 688-3372 | M: (404) 323-9976
http://www.yourownsanctuary.com
1 vote Thank Flag Link Wed May 14, 2008
The best buys are in a higher price range - multi family properties in Midtown near Piedmont Park, multi family properties in Old Fourth ward, Cabbagetown, Grant Park, etc.

Downtown - for the price, condos and lofts. $150,000 will not get you much, but if you can obtain a 2/2 or a 2/1/1 near Central Park, and get your landlording rights with thye HOA in perpetuity, then you are good to go for an excellent long term hold on highly rentable property. The McGills, Renaissance, etc...

Near downtown and GA Tech - here I am preachin' it again, but Vine City is bursting with potential in your price range. Single family and multi family properties galore - you just have to be initimately familiar with the streets and the immediate neighbors.

Your struggle is probably rooted in a need for move in ready property, right? If so, $150,000 will not get you very far in the submarkets that I serve across Intown Atlanta.

I think that unless you have a lot more money, I would avoid absentee ownership in our state. What are your reasons for taking on $150,000 worth of debt right now, when the counterbalance of property management, immediate cash needed for repairs/upgrades/whatever may not get you a positive cash flow?

Doing what you propose to do is speculation, not investing, unless you have vivid criteria, an assertive stance on terms and a hyperlocal network that will work hard for you while you are in the Garden State.

Regardless of whether it's a buyer's market or not, your experience and real estate savvy are critical to whether you turn a buck.

Great idea, but how sound are your fundamentals and who is on your team?
Web Reference: http://intowninsider.com/
1 vote Thank Flag Link Wed May 14, 2008
I have a client who has bought three condos in downtown Atlanta as rental property.

1. The Metropolitan Building--a one bedroom condo for 84K and he rents it for $875/mo.
2. The Healey Building--a one bedroom he bought for 209K (initally this was as a second resident, not investment so he was willing to pay more) and he rents this for $1300/mo.
3. The Healey Building--a one bedroom for 145K and rents for $1100/mo.

The problems with downtown are that most of these condos do not have parking so the tenants have to pay monthly parking. Also, factored in with the HOA fees, and property taxes, it is difficult to have positive income flow unless you are able to put money down. The good thing about downtown renting is that it fairly easy to find tenants as Georgia State University is nearby as well as CNN and a lot of downtown businesses so people tend to want to live near school or their office. There are many students who look into renting condos.

However, like Lee and Sarah said, it is difficult to obtain a rental with positive income flow and the investment would really be a long term one that you can hold onto for the appreciation, not the monthly income. In addition, you would have to factor in a management company and their fees. I would say it is probably better for you to hold out on the investment.
Web Reference: http://www.leaveittobee.com
0 votes Thank Flag Link Thu May 22, 2008
Shawn,

It's a great time to invest in your real estate portfolio. Home rentals are becoming more and more popular with the difficulty for so many to obtain financing.

The most important thing when renting property is to make sure you have enough to cover mortgage payments until the home is occupied.

I would be glad to send you some properties to consider in your price range. Downtown Atlanta may not afford you as many opportunities to purchase a home in your price range, but as long as the location is close to busy areas it does not matter where it's located as long as you keep it rented.

Feel free to contact me with your information and I can get to work for you today!

James Dudley
ERA Sunrise Realty
678-781-7418
james.dudley@era.com
0 votes Thank Flag Link Wed May 14, 2008
The rental market in Atlanta is good in some areas. You need to speak with a Realtor who is familiar with the good rental areas and who specializes in working with people who are looking for rental properties. I own rental properties here in Atlanta, and know the market very well. I would be happy to talk with you some more and get an idea of what your goals are and how I can help. Feel free to contact me anytime at 678-776-0135.
0 votes Thank Flag Link Wed May 14, 2008
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