Report: Atlanta rent increases are (gulp) outpacing San Francisco (Millen: real estate, rental)

[fourthwarden]

Originally Posted by arjay57

So even though supply has exploded, affordability is worse than ever?

Only if you ignore the fact that the submarkets with the highest supply increases saw much lower price rises, or even saw price decreases.

The city as a whole needs more housing, but we've done okay in specific submarkets.

Edit: Plus, remember the analogy from the other thread? If you're too slow in adding supply, it won't seem like it's working, since prices will continue to go up. It's just that they're going up slower than they would without that supply. You're still freezing, just slower than if you hadn't put on a bit of warmer clothing.

[brownhornet]

Where exactly are prices decreasing? Honestly there is plenty of housing in the NW burbs and they are still price gouging rent regardless. And let's be real, one of the major selling points for even moving here was the cost of living for the longest.

[Moosehd]

Y'all believe anything on the internet

[fourthwarden]

Originally Posted by brownhornet

Where exactly are prices decreasing? Honestly there is plenty of housing in the NW burbs and they are still price gouging rent regardless. And let's be real, one of the major selling points for even moving here was the cost of living for the longest.

See:

Median 1-bedroom rents are $1,608, down 1.7 percent from a year ago.

In the Buckhead key-findings section. Not only that, but Buckhead overall price increases were lower than inflation over the same time.

Midtown's 1-bedroom rent increases were also below inflation, with the overall price growth just above inflation by 0.2 points.

These are sub-markets that are responding to large increases in supply by leveling off, or even reducing prices. The city as a whole, though, is still growing faster than inflation, so we should repeat the same solutions that are currently working in these sub markets.

We need to also ensure that we can maintain enough growth in the coming years to keep these submarkets steady in the face of growing population.

[Stormhammer]

Originally Posted by Serious Conversation

Many developers are not seeing a need to develop for the average rental market. It just isn't as profitable.

Yeah - IIRC some of the apartment towers in Midtown/Buckhead now have dog parks on the top, work out rooms on like the 12th floor with views, bars at ground level, granite "luxury" interiors.

[fourthwarden]

Originally Posted by Serious Conversation

Many developers are not seeing a need to develop for the average rental market. It just isn't as profitable.

Originally Posted by Stormhammer

Yeah - IIRC some of the apartment towers in Midtown/Buckhead now have dog parks on the top, work out rooms on like the 12th floor with views, bars at ground level, granite "luxury" interiors.

If only we had a list of known, burdensome, and unnecessary zoning requirements that could be removed to help open up the potential profit range, and lower the minimum threshold for a successful project, which would allow developers to target lower income levels.

[testa50]

For the question of "why is inventory growing while rent isn't declining" is probably that prices are gonna be somewhat sticky. If a new building is 70% full at $2,000/unit, and could grow to 100% full if they decreased to $1,800/unit, they'll probably opt to step down gradually and keep as many of their current tenants at $2,000/mo as possible. They'll favor move-in incentives and things like that too.

I'm not sure how apartment financing works, but in condos the financing is often tied to certain sales prices, and if you go below them the loan becomes delinquent or penalized in some way. That why in 2008 there were still 1/1s on sale for $350k in mediocre buildings; the developers weren't able to lower the prices to adjust to market.

Originally Posted by fourthwarden

If only we had a list of known, burdensome, and unnecessary zoning requirements that could be removed to help open up the potential profit range, and lower the minimum threshold for a successful project, which would allow developers to target lower income levels.

Agreed.

[DreamerD]

Originally Posted by ATLTJL

This is one of the key reasons I bought.

Home ownership is a pain sometimes, and I won't say I don't get the appeal of renting.....but it's also nice to know that my mortgage can't jump 70% in on year. It stays exactly the same, and property taxes move up at a much slower pace.

I was sick of giving my yearly salary increases (and then some) to rent increases, you feel like you can never get ahead.

Exactly! The amount of money you put into rent, you could put into a house. Why not build equity? I am considering doing the same if I can in the future. The only thing that would prevent is if student loans get in the way or I choose to move to another state/country.

[Need4Camaro]

Student Loans are a BIG issue as far as buying a home... They're a huge henderence for myself too and the lower wages that jobs pay here are becoming ridiculous as the COL rises, I actually have my eyes set on another position out of state, although the COL is higher, the salary is high enough to meet it and leave me plenty of change.

As for rents increasing, there is definitely a noticible difference in the COL in Atlanta than a few years ago and its getting more expensive, but it seems like people are happy about this which is something I don't quite understand. San Francisco is a beautiful city offering so many Geographical features right at your door steps and great views and currently (all rent increase percentages put aside) costs exponentially more than it does to live in Atlanta and I can assure you noone is happy with how extremely expensive it is to live there. I don't quite think that this is a good thing or somethat that we should be striving for here either.

Either way I believe one big factor as to why the rent isn't raising as quickly in the Bay area as it is in Atlanta is San Francisco is reaching a point of which they can't realistically continue to increase their price and expect that citizens in that metro will desire to continue move there and meet the demands, or basically... for the time being...I am believing it is approaching a cap. Atlanta hasn't yet met that cap, but if salaries don't increase then it will realistically barge into this cap instead of easing into it.

[DreamerD]

Originally Posted by Need4Camaro

Student Loans are a BIG issue as far as buying a home... They're a huge henderence for myself too and the lower wages that jobs pay here are becoming ridiculous as the COL rises, I actually have my eyes set on another position out of state, although the COL is higher, the salary is high enough to meet it and leave me plenty of change.

As for rents increasing, there is definitely a noticible difference in the COL in Atlanta than a few years ago and its getting more expensive, but it seems like people are happy about this which is something I don't quite understand. San Francisco is a beautiful city offering so many Geographical features right at your door steps and great views and currently (all rent increase percentages put aside) costs exponentially more than it does to live in Atlanta and I can assure you noone is happy with how extremely expensive it is to live there. I don't quite think that this is a good thing or somethat that we should be striving for here either.

Either way I believe one big factor as to why the rent isn't raising as quickly in the Bay area as it is in Atlanta is San Francisco is reaching a point of which they can't realistically continue to increase their price and expect that citizens in that metro will desire to continue move there and meet the demands, or basically... for the time being...I am believing it is approaching a cap. Atlanta hasn't yet met that cap, but if salaries don't increase then it will realistically barge into this cap instead of easing into it.

Oh yeah...student loans are a trillion++ problem. It's prevented many millennials from buying homes, especially since during the recession and after, plenty could not get a job and so were not able to pay off debt. I wish Atlanta offered higher wages for your industry because no one should have to move because of low salary but I am glad you found better elsewhere.

It does seem like a lot of people are happy rents are increasing but look at the people and you will understand why. I hope Atlanta doesn't get anywhere near to where San Fran is in terms of cost of living. When the poor can't afford to live in the city and have to commute from how far and live with how many roommates, to me it's no longer a city worth living in. A city should value all its residents and not just the wealthy.