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Atlanta, colloquially referred to as the “capital of the South,” is a large and growing market with interesting investment opportunities. The metropolitan area, officially defined as Atlanta–Sandy Springs–Alpharetta, has a population of over six million and hosts the headquarters of many well-known companies such as Coca-Cola, CNN, and Chick-Fil-A (all of which oddly start with the letter “C”), and has an excellent sports scene anchored by the Hawks (NBA), Braves (MLB), and Falcons (NFL).

In this article, we’ll cover Atlanta’s housing market and economy and offer investing tips by an expert in the city.

Home Prices

Atlanta’s median home price falls around $375k, which is less than the national median by about $50k. Below, you can see that year-over-year growth is falling back to just over 0% after a huge spike during the pandemic. 

medain sales ATL
Median Sales Price in Atlanta (2017-2023)

Prices in Atlanta have been flat and even declining for a while, just like other similarly sized cities such as Dallas. Because price growth is plunging, you might expect prices to continue falling in the near future. However, this wouldn’t deter me from investing in Atlanta, as there is still strong demand. For instance, look at this sample of data from Redfin:

Quarterly Net Flow of Redfin Users for Atlanta (2017-2022) - Redfin
Quarterly Net Flow of Redfin Users for Atlanta (2017-2022) – Redfin

Clearly, plenty of people are setting their sights on Atlanta, just like many other destinations in the South. This should help buoy prices throughout the rest of the correction and help Atlanta continue to grow.

Plus, when we factor in what’s going on with supply, it’s pretty clear that the imbalance of supply and demand is still propping up home prices. 

Inventory ATL
Inventory and New Listings in Atlanta (2017-2023)

As you can see in the chart above, new listings are currently reaching new lows, and inventory is dropping off a cliff. Days on market (DOM) is rising, despite the market dynamics at play, but I’ll note that the DOM is more in line with what we used to see pre-pandemic and not anything out of the ordinary when compared to that. 

Days on Market in Atlanta (2017-2023)
Days on Market in Atlanta (2017-2023)

Overall, Atlanta is still a seller’s market, but not as unaffordable as many other markets throughout the country.

Cash Flow Potential

Atlanta is a mixed bag when it comes to cash flow. Below is the rent-to-price (RTP) ratio for each Atlanta metro ZIP code. RTP ratios closer to 1% are generally a good indicator of cash flow. That said, you’ll find plenty of areas south of the city that can get you quality cash flow every month. Up north, not so much.

Rent-to-Price Ratio by ZIP Code in Atlanta
Rent-to-Price Ratio by ZIP Code in Atlanta

The top overall ZIP codes by RTP are:

  1. 30303 – Downtown Atlanta (.99%)
  2. 30315 – Lakewood Heights (.87%)
  3. 30354 – South Atlanta (.83%)
  4. 30349 – South Fulton-College Park (.78%)
  5. 30314 – Hunter Hills (.77%)

Rent Trends

Rent in Atlanta has been growing consistently since 2016. Only within the last year has growth slowed, just like the rest of the country. Overall, median rent costs around $1,940/month as of writing.

Median Rent Over Time in Atlanta (2016-2023)
Median Rent Over Time in Atlanta (2016-2023) – Redfin

Based on what I said previously, strong demand and migration will likely keep rent prices in line throughout the rest of the year and beyond.

Economics and Demographics

If you’ve ever been to Atlanta, you’d know that the traffic is up there with LA on the scale of horror. Part of this is because it’s got a pretty solid job market amplifying its commuter time. According to WalletHub, Atlanta is ranked 21st for the best job markets in the United States.

As mentioned earlier, Atlanta is home to many large corporations, but it also has considerable education, healthcare, and tourism sectors. With a median age of 37 years old, a median household income is just over $77,000, and an unemployment rate of 2.7% (0.7% below the national rate), Atlanta has strong demographics for long-term growth, furthering its case as a solid buy-and-hold destination.

Winning Strategies

Matt Nicklin, an investor-friendly real estate agent in Atlanta, recommends “buy-and-hold investing and house hacking as great strategies for the Atlanta market.”

If you’re interested in learning more about investing in Atlanta, partner with a local investor-friendly real estate agent like Nicklin who can guide you through the strategies, tactics, and neighborhoods to focus on.

Here’s how to contact Matt Nicklin on Agent Finder:

– Search “Atlanta, GA” 

– Enter your investment criteria

– Select Matt Nicklin or other agents you want to contact

Nicklin is a long-time real estate investor in direct ownership and syndication, purchasing his first rental in 2010 before his primary home. He also owns OneSource Real Estate—a full-service real estate brokerage specializing in real estate sales and property management—through which he’s helped an array of investors get started and grow their portfolios. From partnering with rookies to pros, Nicklin’s experience spans the spectrum of creative finance, flips, long-term rentals, wholesale, syndication, and note strategies.

Find an Elite Agent in Minutes

Use Agent Finder to connect with local market experts like Victor Steffen, Kim Meredith-Hampton, and Matthew Nicklin.

  • Search target markets like Dallas, Tampa, or Atlanta
  • Enter investment criteria
  • Select investor-friendly agents that fit your needs

Note By BiggerPockets: These are opinions written by the author and do not necessarily represent the opinions of BiggerPockets.

This post was originally published on this site

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