Rental Property Flip Flop
October 24, 2007
For years it has been difficult for landlords in Atlanta Georgia to buy properties in affluent areas and make a profit renting them out.
The reason for this is that the rents have not kept pace with the housing prices. Prices have been steadily rising in the sought after neighborhoods and school districts, and it is now difficult to find a home inside the perimeter in a good school district under $300,000. Most neighborhoods are priced considerably higher. Yet the rents are still fairly low. There are clean well maintained homes in good Buckhead neighborhoods that take several months to rent at $1800.00. Yet the same house may sell from $450,000 to $500,000 and even with 20% down the payment will be $700-$1000 higher than that!
If an investor were to put 20% down on a $400,000 house your principal and interest at 7% (which is normal for investment property), the payment would be $2,129.00 and that doesn’t include taxes and insurance which would easily add $600.00 more! Yet the house that will sell in a normal market for $400,000 will rent for $1,800 to $2,000 at the most! The payment would be $2,729.00 per month and they would be lucky to rent it for $2,000.00 per month! Doesn’t sound like a great investment!!!
But the Times they are a changing!
Why are the rents so low? There are literally thousands of apartments,lofts, condos and multi use high rises under construction right now inAtlanta. The builders apparently have no shortage of optimism.
Email Alerts
October 11, 2007
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RE/MAX of Buckhead
DAN Connolly
404-370-0050
O. 404-233-4633
Fax: 404-370-0377
Toll Free: 866-RE/MAX-76 (866-736-2976)
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