Beltline Condo/Loft Investment (Atlanta: real estate, rental, HOA)

[jpatlanta]

Given 150k-200k where do people think would be the best place to purchase a 1/2 bed condo/loft. I was thinking of buying one, letting it out for 5 years or so and then hopefully selling with some appreciation and equity pay down. Maybe even keeping as a long term investment to provide income into retirement.

I was thinking a smaller fee simple building someone in 04W but do not know specifics.

[George Chong]

Almost every homeowner association (HOA) has restrictions on the number of units for lease. Check the rental caps before purchasing a unit.

[jpatlanta]

Yes understood about HOA. Having said that there must be many where you can grandfather in or similar. Likewise I think there must be quite a few smaller more establised older buildings without the HOA nightmare in the area.

[red92s]

"Beltline" is a pretty vague area, as it touches (or will touch) a very large geographic area once complete. Are you are talking about the Eastside Trail portion that is complete?

Realize that a lot of people had this idea back when condos were much lower, and now it may be much harder to "buy in" at a price where it can be profitable. Even with some modest appreciation, once closing costs, taxes, maintenance, HOA's, special assessments, and realtor commissions enter the financial equation . . . it could very well be a break-even proposition. Being a landlord for 5 years to come out even at the end sounds like a bad way to spend time to me.

[joey86]

I think a better bet would be to buy a house in southwest Atlanta. You can buy a livable house for 50k in a neighborhood that should have Beltline in a few years. Like red said, you might be a little late for the Eastside area.

[jpatlanta]

Thanks for the input. No question last year would have been a better entry point. I don't want a house and all the maintenance costs. A small brick build loft or similar would be a lot better.

Likewise I don't care about the rent covering the monthly costs. As long as it covers over about 60% of the total cost it still is a great longterm investment. With money in the bank making 1% a longterm rental yeild of 5% or more soiunds great with potential capital appreiciation on top. I will update this once I have some more specifics of areas as I research.

[noah]

Check your numbers. In your example if you only cover 60% of your costs then you will not be getting a 5% return before any appreciation, in fact you will be losing money = no return on your money. And even if you get 5% that is very lousy for real estate. You can get 5-10% in a good mutual fund with less hands on managing and more liquidity if you want to sell. Professional landlords look to make 15-25% on their property. More goes into it then can be written here but consider the risk for what you getting. That isn't too say there are a lot of us accidental landlords that are feeding properties but not sure I would consider buying into such an arrangement today.

Originally Posted by jpatlanta

As long as it covers over about 60% of the total cost it still is a great longterm investment. With money in the bank making 1% a longterm rental yeild of 5% or more soiunds great with potential capital appreiciation on top. I will update this once I have some more specifics of areas as I research.