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Old 06-24-2008, 02:07 PM
 
61 posts, read 211,516 times
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Initially i thought poor construction! Then i thought because its really country out there... but still I cannot make sense out of the reason why homes are so cheap.. is it because of sprawl? bcause you have to commute a long time to work?/ or do I go back to poor construction?
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Old 06-24-2008, 02:17 PM
 
Location: Atlanta,Ga
825 posts, read 2,088,179 times
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It depends on where you are looking. What part of town are you finding these cheap houses?
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Old 06-24-2008, 02:18 PM
 
263 posts, read 796,672 times
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no natural boundaries

all major cities that are expensive have natural boundaries

atlanta doesnt have any large lakes, rivers, oceans, etc to limit the ground

miami can only grow north/south because they have an ocean to the east and a swamp to the right

LA has the mountains and oceans blocking growth

Chicago has lake michigan blocking growth

etc
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Old 06-24-2008, 02:28 PM
 
Location: Cobb County, Georgia
754 posts, read 1,514,212 times
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Quote:
Originally Posted by Newyorker2 View Post
Initially i thought poor construction! Then i thought because its really country out there... but still I cannot make sense out of the reason why homes are so cheap.. is it because of sprawl? bcause you have to commute a long time to work?/ or do I go back to poor construction?
hmm really country out here? I'm going back to plowing the fields
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Old 06-24-2008, 02:51 PM
 
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It's dominated by supply and demand. There are expensive properties and cheap properties. The difference is mainly location and quality of construction. Cost of labor is low in Atlanta area. Abundant labor supply from Hispanic population is keeping price low.
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Old 06-24-2008, 04:51 PM
 
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Cheap labor and cheap land. The cost of construction materials for a new home in the Atlanta market is the same as the cost for a new home in suburban NJ, and even though the labor is somewhat lower here, it's not that big of a factor. The biggest factor is the land- I can buy 10 acres of raw land 30 miles from downtown Atlanta for less than what you'd pay for a 50'x100' lot in most neighborhoods within a 30-mile commute to NYC.
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Old 06-24-2008, 04:53 PM
 
Location: Roswell, GA
677 posts, read 1,737,088 times
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Quote:
Originally Posted by Newyorker2 View Post
Initially i thought poor construction! Then i thought because its really country out there... but still I cannot make sense out of the reason why homes are so cheap.. is it because of sprawl? bcause you have to commute a long time to work?/ or do I go back to poor construction?
Homes consist of houses and the land they're on. Houses in Atlanta probably cost somewhat less than those in the northeast or on the west coast because the labor pool is less expensive (and less thoroughly unionized), but the real difference is the cost of the land under the house. As Chip1980 mentions, there are geographic constraints on growth in the more expensive markets that don't exist in the Atlanta area, which is one reason for the lower land values here. Another is simply demand -- there are more potential buyers for a given property in Manhattan or Boston or D.C. than there are for one in Atlanta. Given that in other markets supply is constrained by geography and demand is higher, there's no real mystery to why comparable properties are less expensive in the Atlanta area. It'd be a mystery if they weren't.
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Old 06-24-2008, 05:55 PM
 
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Well it is the South, home prices in the South are not as inflated as they are in the Northeast, I never understood that either, I mean the brutal winters would deter me. New York I understand the high prices, but DC, not getting why it is so expensive. Atlanta is not all cheap though. People making 150K a year seeking single family homes are being priced out of certain areas. But typically, homes in the South in general are cheap, I am from Memphis and you can get a 5 bedroom 4 bath custom built home for 350K, it would be about 550K here. But construction is actually better down South, I could not imagine if a earthquake hit New York, all those highrise tumble like Lego Blocks. But just remember, your living in two different parts of the country, it is like your asking, why is real estate higher in major European Cities like London, Milan, and Paris, than Boston.
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Old 06-24-2008, 06:47 PM
 
5,266 posts, read 4,472,794 times
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Originally Posted by BobKovacs View Post
Cheap labor and cheap land. The cost of construction materials for a new home in the Atlanta market is the same as the cost for a new home in suburban NJ, and even though the labor is somewhat lower here, it's not that big of a factor. The biggest factor is the land- I can buy 10 acres of raw land 30 miles from downtown Atlanta for less than what you'd pay for a 50'x100' lot in most neighborhoods within a 30-mile commute to NYC.

In NJ, you get dumps for houses at 300k! looking at the houses in Peachtree,etc... they are beautiful and you cannot touch a house in Jersey for 300's !!if you want it to be truly pristine and have any land!
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Old 06-24-2008, 07:26 PM
 
Location: San Diego, CA
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Well, there are a variety of reasons for this 'affordability'. While most newcomers find these homes well within their price range, most native Southerners can not afford such things, especially not in the Atlanta area (unless they're really lucky!). But anyways, here are some reasons;

1. Availability of Construction Materials - The Southeast produces a significant portion of construction materials necessary for new homes. From top quality wood from the pine forests, to the gypsum mills, and the various quarries. The relatively short distance in which these materials travels allows for significantly reduced costs. With today's fuel prices, that is enough to make a huge difference.

2. Lower Income/Lower Pay - Since most Southerners can live comfortably off significantly lower incomes, there is no reason to inflate people's incomes, or the homes they buy. Construction workers do not get paid as much, because once again it does not require as much to live off as it would in the North or West.

3. Non-Unionized Workers - The absence of Labor Unions has allowed the growth of the manufacturing sector without Unions demanding constant pay raises that eventually run prices up. Without this hindrance, people do not require as much money to live on (going back into a previous reason). This also slows inflation from affecting the area as much as it would elsewhere.

4. Availability of Land - In the Atlanta metro especially, Land is plentiful. With no natural boundaries to stop the growth, the sprawl can continue unimpeded in all directions. Land is not as scarce, and there for is not expensive. Basic Economics.

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The answer is quite simple really, but its really a matter of perspective. To a Southerner, 300K would put the family in bankruptcy; But to a Northerner, its a dream come true!

Hope I answered your question.
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