Atlanta Real Estate: What is going on in your area? (Roswell: sale, rent)

[BobKovacs]

Originally Posted by plessthanpointohfive

I guess in times like these it's probably not the best investment ot buy in a subdivision that's NOT built out and mostly sold.....

Not necessarily. It's not the best idea to do so if you're planning on buying and then moving in a few years, which was the case in many instances recently. I knew people who bought homes in Phase 1 of developments in Las Vegas, never moved into the houses, and sold them a year later for 20-30% gains because of price increases as future phases came up. The same thing took place in many hot markets. To do that today would be insane.

If, however, you've got no intention of moving anytime soon, there's no reason to avoid a new subdivision, provided that it's in an area that's seeing continued growth, and by a reputable builder. There's always a risk, or course, but you can mitigate it somewhat by doing some research.

[BGS99]

Originally Posted by spacelord75

Yowzers....didn't think this would blow up so much! You guys were hitting on exactly what I was getting at. I am not sure why BGS99 is getting so bent out of shape about this, although I understand what his point is about buyers dictating market value. His taking offense or arguing about the car analogy, though, is incongruent with reality however, because that analogy was spot on in this circumstance. Also, while the brand new construction may carry a value to the buyer, the reason why it would be an imprudent INVESTMENT is because it has obviously already lost value (evident by the comparable assets, which are now basically all equal). It is very similar to a car, in fact - the loss one would experience on selling a car they purchased "new" versus "pre-owned" is larger. This is the same case here. Yes - YOU may get more value out of the newer home (value = enjoyment on a person by person basis, assuming you are so inclined) but you must also obviously then understand that your loss will be more substantial than if you had purchased the pre-owned/resale property instead. This is where pure logic would say this is a poor investment.

I still disagree with the analogy. To be specific to this situation, are the 2-3 year old homes appraising for less money now? Or are they just not selling for what the brand new ones are selling for? You indicated in your original post that you dont understand why people are paying a premium for the new ones.
Say you buy a new home for $100K then 2 years later new homes exactly like yours are built and sold for $110K. Just because buyers are willing to pay a $10K premium for a new home doesnt mean the 2 year old home has depreciated. It just has not appreciated. If the 2 year olds are having to drop below market value to sell, I would agree that there is a problem. But you indicated they are priced above value just not fetching the 10-20% premium for the new homes.

[spacelord75]

Originally Posted by BGS99

I still disagree with the analogy. To be specific to this situation, are the 2-3 year old homes appraising for less money now? Or are they just not selling for what the brand new ones are selling for? You indicated in your original post that you dont understand why people are paying a premium for the new ones.
Say you buy a new home for $100K then 2 years later new homes exactly like yours are built and sold for $110K. Just because buyers are willing to pay a $10K premium for a new home doesnt mean the 2 year old home has depreciated. It just has not appreciated. If the 2 year olds are having to drop below market value to sell, I would agree that there is a problem. But you indicated they are priced above value just not fetching the 10-20% premium for the new homes.

Although not a direct analogy in every regard, the basic concept is by simply owning the home, it's value is declining the day you take ownership. IE, If you bought the new home for $110k, but then, say, a month later were relocated for your job, you would then have to sell the home for $100k.

Obviously the house is not depreciating in the accounting sense, in that a monthly expense is occuring reducing the amount. But siimilar to a car, that premium you paid for the "new" asset is gone the second you close on the house.

[Jazz Piano]

I'm off of 78 in Snellville--seems to be slow out here. Some beautiful subdivisions (especially one across from the movie theatre, Golds Gym---great deals!!!).

Maybe Lowe's knows something we don't...they're building another one in Loganville---that makes like 5 within 5 miles of one another.

[dlh891]

Originally Posted by Jazz Piano

I'm off of 78 in Snellville--seems to be slow out here. Some beautiful subdivisions (especially one across from the movie theatre, Golds Gym---great deals!!!).

Maybe Lowe's knows something we don't...they're building another one in Loganville---that makes like 5 within 5 miles of one another.

Actually, I'm a realtor in Snellville and have my hands full with deals right now. Alot of homes priced under 150k are getting multiple offers if it's in decent shape. I deal with investors and first time homebuyers and they are out in force right now.

Actually, my own home is listed at 350k (in Snellville) and my phone rings nonstop to see it.
I barely have time to keep the lawn mowed...

[Jazz Piano]

Originally Posted by dlh891

Actually, I'm a realtor in Snellville and have my hands full with deals right now. Alot of homes priced under 150k are getting multiple offers if it's in decent shape. I deal with investors and first time homebuyers and they are out in force right now.

Actually, my own home is listed at 350k (in Snellville) and my phone rings nonstop to see it.
I barely have time to keep the lawn mowed...

Which subdivision? The one I was talking about was Governors Walk Blvd. I missed my turn to Pep Boys the other day and drove in. Some gorgeous homes! Looks like they're about midway through the project.

[LoufromNewYork]

It's great to see these kinds of debates because they mean that people care about their homes contrary to all the news about foreclosures and people walking away from their mortgages.

Resale is important, but a home is a unique investment because it serves two purposes, a CD won't help you when it's raining, you can't park in your 401k, and your daughter won't be able to sleep well on a stock certificate.

That said, buying a new home was by far the best investment I could have made. It is not only where I wanted it to be, but I'm close to all the things I wanted to be and don't have to worry about inheriting anyone's problems. The problems that do arise are fixed (usually within 1 business day by the builder). I have neighbors who care about their homes to, and despite foreclosures across the street, I know my subdivision will only get better since it's such a small amount of homes and more expensive homes and stores are coming up nearby.

I may not be able to "flip" it in 2 years by tearing down some walls and putting granite, hardwood and tile everywhere, but that was never my goal. I have a place where my whole family can come and stay, live near my new family down here and have the enjoyment of seeing my home turn into a house from a slap of concrete and some 2x4s.

To each their own. And for what it's worth I see some great opportunities in West End, Oakland City, and East Point. I might be crazy now, but in 15 years we'll be speaking about those areas differently.

[playground]

Hi,

Can you share some of your expectation and how you concluded that West End, Oakland City and East Point are good potential for investment?

Thank you

Originally Posted by LoufromNewYork

It's great to see these kinds of debates because they mean that people care about their homes contrary to all the news about foreclosures and people walking away from their mortgages.

Resale is important, but a home is a unique investment because it serves two purposes, a CD won't help you when it's raining, you can't park in your 401k, and your daughter won't be able to sleep well on a stock certificate.

That said, buying a new home was by far the best investment I could have made. It is not only where I wanted it to be, but I'm close to all the things I wanted to be and don't have to worry about inheriting anyone's problems. The problems that do arise are fixed (usually within 1 business day by the builder). I have neighbors who care about their homes to, and despite foreclosures across the street, I know my subdivision will only get better since it's such a small amount of homes and more expensive homes and stores are coming up nearby.

I may not be able to "flip" it in 2 years by tearing down some walls and putting granite, hardwood and tile everywhere, but that was never my goal. I have a place where my whole family can come and stay, live near my new family down here and have the enjoyment of seeing my home turn into a house from a slap of concrete and some 2x4s.

To each their own. And for what it's worth I see some great opportunities in West End, Oakland City, and East Point. I might be crazy now, but in 15 years we'll be speaking about those areas differently.

[LoufromNewYork]

Sure Playground, I'll help you connect the dots.

With the ways things are going, people are moving BACK into the city. Living in the suburbs is cool, and there will always be people that want that, but more people see that they can give up having a car payment, filling a car up with expensive gas, having to get insurance, finding a place to park it, and maintaining a car. For those people, there is a limited amount of land. No one really wants to touch SW Atlanta with a 100' pole but the people that get in there in I'd say the next 2-4 years will enjoy what's going to happen.

Consider the following:
-tons of homes are close to MARTA stations, which people will love
-the Beltline, whenever it's done will pass through SW Atlanta making it easier for people to live in WE, OC, and EP and get to other parts of the metro area
-there are lots of restuarants if you go down Main Street, so you can walk to places to eat
-houses in this area are dirt cheap with lots of people that love their neighborhood getting people together to help


It's all my hunch, but when you consider what's going on in other Metro areas (Chicago, New York, DC) what I'm talking about isn't very far fetched.

[johnatl]

^I agree, Lou. Don't forget about the massive redevelopment coming to Fort McPherson soon, as well as the almost total remake of Hapeville that is starting up already. These areas are going to be on fire when the economy turns around.