The Atlanta Housing Market started 2021 the same way it ended 2020, with prices continuing to increase and supply continuing to decrease. Current supply levels dropped to 1.2 months (6 months is normal) and the median sales prices was $309,000, up 17.9% from 2019. Below is the market update for January 2021 from the Atlanta REALTORS® Association.
Demand: January residential sales were at 4,421, an increase of 1.0% from the previous year.
Price: Average and median sales prices continue to outpace 2020’s figures, with positive gains. The median sales price in January was $309,000, an increase of 17.9% from last January. The average sales price was $379,000, up 17.9% from the previous year.
Supply: Atlanta area housing inventory totaled 8,133 units in January, a decrease of 48.5% from January 2020. New listings totaled 6,679, down 19.4% from January 2020 and up 27.1% from the previous month. The month’s supply over a 12-month period decreased to 1.2 months.
The Atlanta Housing Market remained strong in November. Demand remained strong, up 9.8% from 2019. Due to a continued drop in inventory and strong demand, prices continued to appreciate throughout Atlanta. Current supply levels dropped to 1.6 months (6 months is normal) and the median sales prices was $310,000, up 15.7% from 2019.
Demand: November residential sales were at 5,950, an increase of 9.8% from the previous year.
Price: Average and median sales prices continue to gain traction and outpace 2019’s figures, with positive gains. The median sales price in November was $310,000, an increase of 15.7% from last November. The average sales price was $376,500, up 15.0% from the previous year.
Supply: Atlanta area housing inventory totaled 10,485 units in November, a decrease of 42.3% from November 2019. New listings totaled 6,239, down 5.8% from November 2019 and down 27.1% from the previous month. The month’s supply over a 12-month period decreased to 1.6 months.
As expected the overall volume of real estate transactions decreased. However due to a continued drop in inventory and low interest rates, prices continued to appreciate throughout Atlanta. Below is the market update for October 2020 from the Atlanta REALTORS® Association.
Demand: October residential sales were at 6,051, a decrease of 3.3% from the previous year.
Price: Average and median sales prices continue to gain traction and outpace 2019’s figures, with positive gains. The median sales price in October was $315,000, an increase of 19.8% from last October. The average sales price was $375,500, up 16.8% from the previous year.
Supply: Atlanta area housing inventory totaled 12,291 units in October, a decrease of 36.9% from October 2019. New listings totaled 8,122, down 9.5% from October 2019 and down 4.7% from the previous month. The month’s supply over a 12-month period decreased to 2.0 months.
Demand: May residential sales were at 4,085, a decrease of 36.8% from the previous year.
The Atlanta Real Estate Market in September continued the strong activity observed in August 2020. Despite all of the uncertainty in the country, September has showed that the fundamentals are still in place to support a strong Atlanta housing market. Record low mortgage rates have certainly driven demand along with a renewed optimism in the economy. Strong demand along with low (and decreasing) supply has resulted in houses flying off the market, bidding wars and continued price appreciation. Although prices continue to rise in Metro Atlanta and the surrounding suburbs, the extremely low interest rates have helped counterbalance the increase in prices. Without an increase in inventory it will be interesting to see where the market goes next.
Here’s a summary of some key metrics.
The Atlanta Real Estate Market in August continued the strong activity observed in July 2020 and took it to the next level. The strong demand in June and July is generally believed to be due to pent up demand from the shutdown. August has showed that the fundamentals are still in place to support a strong housing market. Record low mortgage rates have certainly driven demand along with a renewed optimism in the economy. Strong demand along with low (and decreasing) supply has resulted in houses flying off the market, bidding wars and continued price appreciation. Although prices continue to rise in Metro Atlanta and the surrounding suburbs, the extremely low interest rates have helped counterbalance the increased cost. Without an increase in inventory it will be interesting to see where the market goes next.
Here’s a summary of some key metrics.
The housing market for Sellers is still extremely strong. With inventory and interest rates at historic lows, well priced houses are selling quickly. But how do you know how to price your house correctly? Start by getting a detailed market report for your home via the “What’s My Home Worth Button” below. With just a couple of clicks and some basic information your report will be in your hands within minutes.
The Atlanta Real Estate Market in September continued the strong activity observed in August 2020. Despite all of the uncertainty in the country, September has showed that the fundamentals are still in place to support a strong Atlanta housing market. Record low mortgage rates have certainly driven demand along with a renewed optimism in the economy. Strong demand along with low (and decreasing) supply has resulted in houses flying off the market, bidding wars and continued price appreciation. Although prices continue to rise in Metro Atlanta and the surrounding suburbs, the extremely low interest rates have helped counterbalance the increase in prices. Without an increase in inventory it will be interesting to see where the market goes next.
Here’s a summary of some key metrics.
The Atlanta Real Estate Market in August continued the strong activity observed in July 2020 and took it to the next level. The strong demand in June and July is generally believed to be due to pent up demand from the shutdown. August has showed that the fundamentals are still in place to support a strong housing market. Record low mortgage rates have certainly driven demand along with a renewed optimism in the economy. Strong demand along with low (and decreasing) supply has resulted in houses flying off the market, bidding wars and continued price appreciation. Although prices continue to rise in Metro Atlanta and the surrounding suburbs, the extremely low interest rates have helped counterbalance the increased cost. Without an increase in inventory it will be interesting to see where the market goes next.
Here’s a summary of some key metrics.
It’s been a little over 3 years since I purchased my first rental property so I thought it would be interesting to look back and see how I did. I learned a ton from the process of purchasing this property. Although this was the third property added to my real estate portfolio, I credit this little gem with being the catalyst for catapulting my real estate career. Check out my blog post, My First Rental Property, to read the full story of how I purchased this property.
Quite often when either someone finds out I’m a REALTOR® or they already know me and we get involved in a general conversation, I get asked “How’s the market?”. This might seem like a simple question, and on some level it is, however the answer is more involved. Unfortunately (or fortunately depending on your perspective) many real estate professionals will respond with a simple “Good” or “Bad”. And typically that’s the answer most people are looking for. But I’m not most people. We can do better.
Although the question “How is the market” is a simple question on the surface, for me to answer the question accurately I need to know more about the person asking the question. Everyone has different goals, experience, perspectives and motivations for asking that question as well as a different definition for “Good” or “Bad”. What is good for one person can be bad for another. This is true in life but absolutely critical in investing. The answer to this question can be (and many times is) very different depending on the person asking it. As a simple example, is the person asking about the market looking to buy or sell a house?. This one little detail can change my response from “Great!” to “Terrible!”. If I assume I know how the person defines “Good Market” and“Bad Market” or that I know what they are looking to do, then I might give them misinformation which could result in them making poor financial decisions. Here are some examples of possible motivation for asking “How’s the market?”:
I’m often asked about the current state of the Atlanta housing market. Typically followed by “Is this a good time buy a house?” or “Is this a good time to sell my house?”. Most are surprised when I answer “Now is a great time to both buy and sell a house”. How could that be true? Conventional thinking states that the Real Estate Market is in one of three states. “Seller’s Market”, “Buyer’s Market” or “Balanced Market”. Although there are varying degrees of Seller’s and Buyer’s markets, they are typically considered mutually exclusive. For example you can’t be in a Seller’s Market and Buyer’s Market at the same time. Since today’s market in Atlanta is currently a Seller’s market but also a great time to be a Buyer, I describe it as a Paradoxical Market.
It’s been a little over 3 years since I purchased my first rental property so I thought it would interesting to take a walk down memory lane. Although this was not the first piece of real estate I’ve ever purchased, this was the first house I purchase for the sole purpose of renting it out and holding it as an investment. Prior to the purchase of my first rental property in 2017 I purchased a Condo in 2009, which I turned into a rental in 2015. I also purchased a Townhouse as my primary residence in 2015. So although I had some experience purchasing real estate I had never purchased a piece of real estate as a pure investment.
To help paint the full picture of how I knew this particular house was the one for me and therefore was able to make a quick decision, I think it’s important to provide a little backstory. Towards the middle of 2016 I decided it was time to purchase my first single family house for the sole purpose of renting it. I had been observing areas in Southwest Atlanta that seemed full of potential with construction of the Beltline. I already noticed a lot of momentum and new development which was resulting in price appreciation. My main objective at the time was price appreciation, with cash flow being secondary. I wanted to keep the price of the house relatively low, to limit my risk, since this was going to be my first investment in a transitioning area. My main focus was on Adair Park and Capitol View since I had become familiar with those areas when I first starting looking at properties in 2015. Unfortunately by the time I was ready to jump in and pull the trigger, Adair Park and Capitol View had become extremely hot. The prices were rising to levels that I wasn’t comfortable with and the houses that were in my price range were in multiple offer situations. Long story short, I either couldn’t move fast enough or I repeatedly was outbid.
During times of uncertainty it’s easy to get caught up in a cycle of fear and doubt. This is completely understandable as you may have real and serious concerns like how will you pay your rent, mortgage, utilities or even buy food. Once you get caught in this cycle and let fear drive your thought process it will be even harder to come up with solutions and ultimately get you back on your feet. Below are some things that I think can help and what I am currently practicing.
When something unexpected occurs it can be a shock to the system. The more dramatic the occurrence (like a sudden loss of your job) the greater the shock. I think it’s natural human behavior to react emotionally and that’s ok. You might go through a slew of emotions like anger, sadness and fear. Spend some time venting, complaining and worrying. But don’t spend too much time in this phase. The longer you’re here the harder it will be to move to the next step in the process. Eventually you need to get to a place of acceptance. Once you accept the hand you were dealt you can move on to the problem solving phases.
Once you have made it through the mourning phase it’s time to pick yourself back up and start the problem solving phase. It’s easy to feel overwhelmed in this phase so try tackling one thing at a time. Write a list (yes pen and paper) of the top issues, in priority order, that you need to address. I find it helps to focus on one particular problem or task than trying to solve everything at once. Attempting to solve all of your problems resulting from the current situation will cause you to feel overwhelmed and limit your ability to think clearly. Move down your list one at a time and either write down your next step to solve that problem or jot down a couple of options.
There are a couple of schools of thought on the use of leverage (a.k.a. debt) for investing. Dave Ramsey preaches that everyone should be completely debt free and you should never use debt to acquire investments. Unfortunately that means that most of us would never have a chance to invest in real estate. I on the other hand believe that the responsible use of leverage can provide returns far superior to investments relying on cash only and dramatically accelerate the growth of your net worth while allowing you to reach goals you may have never reached otherwise. The use of leverage is one major advantage real estate investments have over others like stocks and bonds.
The fundamental idea of using debt to invest in real estate is quite simple. You pay a portion of the purchase price for a piece of real estate with money from your savings and obtain a loan for the remainder. Although the concept is simple and the majority of people who purchase a home use this approach its true power is displayed when investing in rental properties. There are many forms of leverage and various strategies but in this post I will focus on the simplest one and the one that has provided me with great results.
To illustrate Accelerated ROI from the use of leverage I’m going to provide two examples from my personal portfolio.
Many think that investing in rental properties is more difficult and risky than it actually is and you need to be a real estate expert to do so. I’m here to let you know that’s not true. Although you should not go in overconfident and under informed the fact is anyone can do it as long as you have the right mindset, realistic expectations, a willingness to learn and don’t mind putting in the work. Since there’s a ton of information I can provide on this topic I’m going to break it up into a series of posts. This post will focus on why you should consider investing in rental properties while future posts will address the details around how to do so as well as some of the downsides and risks.
One of the most obvious benefits and most popular reasons people acquire rental properties is the additional cash flow it provides. To keep it simple, Cash Flow is the difference between the rent you’re collecting and your expenses for the property. Expenses can include regular maintenance, insurance, repairs, loan interest, HOA, commissions and utilities. This additional cash flow can be used to pay living expenses, supplement retirement or invest in additional properties. Although it’s critical to accurately calculate your expenses (many new investors underestimate their expenses) when determining cash flow we will see that even if you don’t have great cash flow there are other benefits to owning rental properties.
