Athens Area Real Estate: Market Outlook Mid-Year 2018

Well it looks like it has been six months since I last posted an article on this site.  For the most part, that is a good thing because we have been extremely busy this year, and I have not found much time to write or post to this blog.  Meanwhile, I am sure no one has really missed these articles riddled with my grammatical mistakes.  From what I can tell, people enjoy the posts on Georgia football much more than my thoughts on Athens real estate, but rest assured I will be ready to talk some Georgia football next month.   For now, let me focus on the real estate portion of this blog because I realized today that we are just about half way through 2018 which is an ideal time to look back at what has happened so far this year.

Overall our real estate market remains strong, and we have continued to see appreciation in many price points.  For example, the 5 Points area is still seeing $250 per square foot or more for remodeled homes.  The Normaltown area is trending just behind this price point and moving just as fast.  However, this is not a universal number you can apply to each home.  In most cases, anything below  $650,000 will still move well in the 5 Points area.  But we have seen the highest price point start to level off.  Right now, I would classify anything above $600,000 as our top price level in Athens.  While we are still seeing these homes sell, it appears the price appreciation at this level has finally cooled off.  I believe this to be a good thing in the long run.  As I have said many times on this blog, “trees do not grow to the sky”.  It is good to see the price values calm down in one area of the market.  Another contributing factor is the current pricing by sellers.  There are some properties on the market asking for a little too much money which is understandable given our market trend over the last two years.  This is typical of any market going as hard and as fast as Athens and Oconee.  Interest rates are ticking up, but demand remains high for home buyers therefore I don’t see our market tanking anytime soon.  In fact, I am relieved and encouraged to see a slight cool down in appreciation.

On the other hand, the condo market around town has been incredible with some of the biggest gains in value over the last 12 months.  Our company and myself deal with a lot of condo properties throughout the area.  It usually works out to be about 1/3 of my personal business year end and year out.  For example, inside of one-year condos in downtown Athens have gone from $240 per square foot to over $280 per square foot or more.   On the westside of town, condos at Woodlake have appreciated 8.5% in less than a year.   If you cross the river to the eastside on Barnett Shoals road the results are the same.  The Summit, The Woodlands, Brookwood Mill, and Drayton Square have all seen a big increase in value of the last year.  The condo market was hit hardest by the recession due to new banking regulations and fear amongst buyers.  Thankfully, the fear is gone, and lenders are now able to lend money on most condos in our area.  But the lending is not the same as a traditional home so be sure to work with a professional when buying or selling condo units.  A loan approval from a buyer doesn’t exactly mean that loan will work for a condo purchase.

Lastly, Athens-Clarke County has seen a large increase in property taxes all over town.  The amount will vary property to property, but overall the county saw an increase somewhere around 5 to 6%.  Tax values going up is inevitable when we are seeing properties appreciate this way, but I do think it can have a negative effect.  Obviously, the typical home owner is burdened with increased taxes and their mortgage payments will go up.  In some cases, this is easy to absorb, but in many cases, it becomes a real difficulty on families.   Another thing to consider is that many property owners in Athens are not local to the area.  We have a large amount of property investors or landlords living outside the county, the state, and even outside the country.  These increased costs will be noticed by property managers and landlords alike because they effect the bottom line.  And most of the time these landlords will pass through the increased cost to their tenants by raising the rent.  Many people in town are concerned with affordable housing, and this will do nothing to help that issue.  I don’t know our county’s budget needs off hand, but revenue going up doesn’t necessarily mean spending should as well.  With our increased tax revenues, it may be time for our elected officials and the county to consider reducing the millage rate used to calculate taxes on our property.  All things considered, we are still lucky to live and work here in the Classic City.  Hopefully, we can keep ourselves from messing it all up.  Thanks for reading, and I will try to share a post on a football topic next month.  Enjoy your summer.

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Athens Real Estate: Heaven Help the Home Buyers

My basement is full of firewood that I have yet to burn because the weather been has so warm this winter, and just like the weather in Athens the real estate market has been historically HOT in 2017.  It is truly amazing just how fast some things are moving.  I have lived in Athens for 18 years now, and I cannot recall a time where the supply was this low or the demand so high.  In many ways this would seem a like a good thing for our area, but honestly it has caused a lot frustration in the real estate world. As a real estate broker, one of my primary jobs is to help buyers and sellers come together, and that has seemed harder lately than I can remember which has surprised me.  The main reason seems to be the lack of supply.  Many buyers have found it hard just to get inside a property before it is under contract, and many sellers have remained firm at high list prices resulting in low appraisals.  At the end of day, my job is to help people navigate these hurdles, and today it seems the buyers have many more hurdles than the sellers.  So I want to talk a little about our market and what a buyer should be doing to find their ideal property.

First of all, why do we have such a large amount of home buyers in our market?  In my opinion, this is due to the return of seller equity and low interest rates.  Many sellers were not able to sell when the market was down, but now they can exit their own property without taking a loss.  It seems a lot of these sellers become Athens area home buyers, because so many people want to move here and so few want to leave the area.  Long and short, we have it pretty good in the classic city, but what do you need to do to buy in the area you prefer?  I would start by telling any home buyer to reach out to a good local and experienced realtor for many reasons.  But most of all, for their expertise and knowledge in the market where you are trying to move.  When the market is up you need strong advice on prices, appraisal values, and when to act fast.  This is not the time to call your best friend who sells two houses a year or less.  You need to call people that have the experience in the market you want to buy.  Don’t ask your buddy if he knows someone unless your buddy knows a lot of people in real estate.   In most cases, an out of town agent simply cannot know a market well when they live hours away.   Our town can be very close knit, and a local realtor often will know of homes for sale that are not on the market.  Here at 5Market, we frequently have seller clients that reach out and ask us to bring an offer from a qualified buyer instead of listing their house.  Despite the efforts of many, our real estate market is heavily based on experience and strong local relationships.

The next thing to do is to tell the truth.  I often start with telling my clients to be honest with me about properties so I can better understand how to help.  It is ok to say, “I hate this house or I don’t care for this street”.  Please tell your agent what you want and why.  Another part of being a home buyer is being prepared to act.  Buyers need to have a conversation with their lender before stepping foot in one home.  That way you have an idea of what you can afford and what cash outlay is best for you. Therefore, you can act quickly on a hot property.   In most cases, your realtor will know several good lenders to speak with before getting started.  Home buyer’s now need to be proactive on the home search as well by using websites like Zillow and Realtor.com.   Many real estate brokers are often frustrated with Zillow and Trulia because the sites can be inaccurate and sometimes advertise homes that are not for sale.  Furthermore, they can mislead buyers and sellers on home values especially here in Athens.  While this is true, I appreciate these sites because it gives my clients a place to search homes on their schedule.  A good agent will have more than a few clients, and they can’t be expected to sit at the computer to wait for new homes all day every day.  For example, I encourage buyers to use these sites, but we also encourage them to download the MLS app which can verify listings they might find.

In closing, I think the most important thing I typically discuss with clients is that things have a tendency of working out the way they should.  In my experience, when a client loses a house or an inspection goes badly it seems to work out for the best.  So many buyers lose out on houses, but they often find another one they like even better.  I am a big fan of learning and borrowing from others.  When I hear something wise I try to remember it and internalize it.  One of the best things I have heard my co-worker, Jeb Bradberry say is that, “Patience is a Virtue”.  This is true in life, and true in real estate.  So remember try not to be discouraged and remain patient because if you deal with good people in business it has a tendency to work out for the best.

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The State of Athens Real Estate: Low Supply & High Demand

We are a few days away from 2017 which is an ideal time to look back at the year that was in Athens real estate.  Clearly, 2016 was an interesting year, and the overwhelming story of 2016 would have to be the Presidential election because it was very polarizing and ultimately quite surprising.  It seems half of the country is optimistic and the other half believes the end is near.  Despite your feelings about the year in politics, I can assure you that the Athens real estate market had a great year in 2016 thanks to many contributing factors.

First of all, we reside in a fairly desirable area with a major university and that never hurts.  Furthermore, interest rates have remained low which continues to fuel the market since money is currently cheap.  Lastly, many neighborhoods have seen more and more appreciation because availability remains scarce.  While all of this is generally good for the greater Athens area it has proven to be difficult for buyers.  And it is primarily due to the very low supply of homes in the market place.  Let me be clear that I am usually a big fan of low supply in real estate.  In fact, that is exactly what sellers want when they go to market.  However, working in real estate allows me to see both sides of the coin.  We work with many home buyers that are desperate to find what they need in the area, and right now many of them are frustrated.   Generally, the more affordable houses remain the hardest to find.  Right now in Oconee most properties under $300,000 are gone in a week.  Additionally, the in town areas like 5 Points and Normaltown barely have any listings under $400,000.  Meanwhile, the local market for investment is also highly competitive because workable properties are almost nonexistent right now. It has been a long time since the Athens real estate market was this low on product.  All this being said, the Athens market is seasonal especially when it comes to residential homes.   Usually, the New Year brings more homes to market, and I am confident we will see that trend continue in 2017.  So what does all this mean? Will this appreciation continue or not?

The truth is that no real estate agent really knows for sure, but we can try to make educated predictions based on what we know about our local market along with the economic factors.  As I mentioned earlier, the election was kind of a big deal this year, but its impact for good or bad may not be felt immediately.  I am not a stockbroker, but if I was I might advise people to get into financial stocks and stay there for a while.  But you know what?  I am no stockbroker, but I am fairly knowledgeable about Athens real estate.  So here are some predictions for 2017 in our area.

Interest rates are going up without a doubt.  Good sense tells us that they can’t stay so low for so long, but they also can’t grow too high too quick because our economy just can’t handle it.  The real estate market has been fueled by these low rates.  On the other hand,  I don’t believe reasonable rate hikes will kill the market.  In fact, it may even make it stronger at first.  There is a lot of interest rate fear with buyers right now which could bring even more people to the table.  On the other hand, higher rates could also create some price stabilization which will help these buyers.  I have said it before that, “trees don’t grow to the sky”, and while that is true, I don’t’ think prices stabilizing will be a bad thing.  Given the lack of availability in several neighborhoods we should see appreciation slow down without prices falling off.  So while trees don’t grow to the sky they can still stand pretty tall.  Conversely, the Athens investment market might be a little harder to read.  The Athens investment market has come back since 2010, but we have not seen the prices return to the highs of 2007.  Low interest rates have forced most investors into the stock market to gain an actual return on their money.  However, investment real estate provides a great alternative to the stock market which should continue.  Nevertheless, we may see the same price stabilization with investment properties that we could see with residential homes.  Rental rates have been growing in our market, but more student bedrooms are coming soon.  In all honesty, it is hard to know which rental development it will immediately impact until it all plays out.  But I can assure you that location is all that matters when the chips are down so be sure to keep that in mind.  And there you have it, a brief recap with a look ahead.  Here’s to hoping my predictions are correct.   Have a great new year, and an even better 2017.

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The Athens Condo Market: What You Need to Know

Most of you probably have an idea or at least a decent understanding of what constitutes a condominium, but just in case I will try to clarify it a little bit.  In general, a condominium is a unit or space that can be purchased inside a larger building.  When a person owns a condo they have exclusive ownership of a specific space or unit inside a building while also owning a small percentage or shared ownership in the rest of the building.  All the owners in a condominium share in the cost or upkeep of the entire building or complex. For example, condo owners pay HOA fees that cover building insurance, maintenance, and often the cost of amenities.  They can be attractive real estate because they are often more affordable than traditional homes, they offer low maintenance, and are often ideal second home purchases.  Nevertheless, many condo owners are suffering due to the recent recession.  In many areas condo values have dropped drastically, and while most real estate has appreciated in Athens not every condo development has recovered.  In fact, many areas are still close to the values of 2011. On the other hand, certain developments have seen values grow back quickly.   So why have some condos appreciated while others have not?  To understand why you have to go back to the recession.

Hopefully, you haven’t forgotten what happened eight years ago.  The mortgage crisis devastated our national economy resulting with a sharp decline in real estate values.  We saw massive foreclosures across the country, and condos were a major part of the foreclosure market.   First, you have to understand that many condos are developed to be vacation or second homes.  For instance, many coastal areas are covered with condo developments that are owned by people that do not occupy the units full time.   And if someone owns two propertiessimi_valley_foreclosures-sign when money becomes tight, the second home is usually the first thing they can live without.  As a result, numerous condos went on the market in 2010 when most people could not afford to buy them or were scared to buy due to the recession.  Consequently, property values plummeted, and many homeowners had to let their condo go into foreclosure.  Banks across the county took massive losses on condos, and now many large banks will not finance a condo.  And that’s the problem many condo owners face today. The financing has become more difficult which shrinks the pool of buyers resulting in depressed values.  Here in Athens, we have some condos appreciating and others that are not.  So back to the question, Why?

 

The answer is simple, and it is almost always the same LOCATION, LOCATION, LOCATION.  You may think I am beating a dead horse, but it is the truth.  All properties are valued based on their location, but condo values are even more dependent on the location.  As an example, look at downtown Athens whereWelcome-to-Downtown-Athens many condos have appreciated over the last couple of years because downtown Athens is a prime location where many condo buyers are looking to purchase.  Meanwhile, the east side of town has an abundance of condos that are valued much less due to location and the overall supply.  For instance, on Barnett Shoals road there are four large condo developments:  The Woodlands, The Summit, Stones Creek, and Brookwood Mill.  All of these developments were originally targeted to investors or parents of UGA students.  They are well built, spacious, and fairly close to campus. However, the supply greatly exceeds the demand keeping the prices low around $100,000.  Conversely, condos at Lumpkin Square or East Cloverhurst are worth around $150,000 for a smaller and older two bedroom unit.  These condos are worth more because they are right next to campus and walkable to restaurants and Sanford Stadium.

lumpkin-square
Lumpkin Square Condos

So does this mean you should not buy a condo?  Heavens no!  Condos are still a very good purchase depending on the price, the location, and the purpose.  The values on the eastside of town offer a really low price point for investment.  In some cases, buyers can still purchase a three bedroom condo in the low $100s. And remember, a condo in an ideal location will always have value.  Additionally, we are starting to see condo financing improve, and I believe it will continue to get better over the next couple of years.  In closing, if you have a condo to sell or are looking to buy one don’t worry because either is very doable.  But I suggest you find someone in the area that really knows their stuff because you will need help to navigate the market and the current financing climate.

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Real Estate Appreciation in Athens

It is now the beginning of August, and kids are either back in school or getting ready to start.  The summer is almost over, but it hasn’t cooled off in the slightest.  And it probably won’t for a month or two.  Historically, this time of year marks the slowdown of the Athens real estate market at least with regards to residential homes.  However, I will say that this year may be unique because things haven’t slowed down quite yet.  There are still plenty of buyers in the house-prices-upmarket, and a surprising number of homes are still going up for sale.  Long and short, our local market seems to be generally strong despite a few areas here and there or difficult price points.  Overall, we have seen most properties continue to appreciate over the last year.  Especially, when it comes to the in town neighborhoods.  Which is great news of course, but what is causing our values to go up?  Will it continue?  Will it not?  No one has a crystal ball of course, and there are numerous factors that create our market many of which are on a national level.  I don’t know who is going to be President, and I don’t know what will happen to interest rates.  I can certainly make an educated guess, but that would be all.  However, I do know our area market, and I think the best way to understand all this appreciation is to focus on the local factors that are influencing our market.

First of all, let me make it abundantly clear that low interest rates are a MAJOR reason for our strong real estate market and increased values.  Money is cheap right now, and people should take advantage while they can because it will not last forever.    While interest rates are a big factor, they are not the only factor.download (2)  For instance, not every real estate market is strong right now even with the low interest rates.  But here in Athens, we have a lot going for us which really helps our real estate.  Earlier, I mentioned in town neighborhoods where homes are achieving the highest per square foot in the area.  This is actually not a new trend.  As an example, 5 Points has always had strong value relative to other areas of town.  It is highly desirable, and land is scarce.  The same can be said for our Normaltown and Boulevard neighborhoods.  Nowadays, Athens is a great place for retirees, families, and young professionals. Which is truly unique for a town the size of Athens.  People are flocking to our small little city because it can offer a high quality of life.  Retirees want to be in town, and many of them can afford to pay for it. Meanwhile, we are seeing just as many young families come to Athens or Oconee from the Atlanta area.  In some cases, they are even willing to commute5 Points Clockeditededited into Atlanta everyday just to live in Athens.  This is all great of course, but I do worry if too many move here we may just become another Atlanta suburb.  Scary stuff!  Another factor that has always helped the Athens economy is the University.  Our local economy is not massive, but thanks to UGA it has some real stability.  UGA is our biggest employer, and it is the primary engine that drives commerce.  The students are wonderful customers to many of our local establishments.  Downtown would likely be a ghost town without them.  Here in Athens, we sell students most of their clothes, gas, entertainment, housing, and food.  Which reminds me of a local business owner who once told me a story about buying a car in Athens.  He said, “the car salesman told me that the university didn’t help his business at all”, to which he replied, “where the hell do you think I got the money to buy this car you dumb@$$? I got it from selling ice cream to college kids!”  To further my point, most of the people that want to move to Athens went to UGA, and love Athens because of the time they spent here in school.  In summary, Athens offers a somewhat stable economy in a highly desirable town.  Meanwhile, land is scarce in most of the in town neighborhoods which creates a demand with limited supply.  Conversely, our neighboring counties have an abundance of land, but also have great schools, achievable home values, and they are right next door to our great city.

To sum it all up, we are really fortunate in Athens.  There many other things I could discuss that influence our market, but I think you get my point.  Besides, I have run on for long enough.  Regardless, this doesn’t mean that you can buy any house in any location and see appreciation.  The same rules will apply to anydownload (1) wise purchase.   First, think about the location which is always the most important factor.  Next, you need to consider the supply in your area and the comparable values.  Lastly, think carefully about the schools, and how many buyers will want your house when you need to sell.  It is much easier to make a bad decision in a strong market.  Thanks for reading, and get excited because we are 31 days away from Georgia football.  Go Dawgs!

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Home Buyers Are Angry in Athens

If you reside in the Athens area than you are probably aware that our real estate market is generally very strong.  After some real tough years, the local market has come back with a vengeance.   As I have mentioned in earlier posts, our in town neighborhoods are seeing appreciation and in some cases a return to the values of 2005 and 2006.  In addition, many areas of Oconee County are performing well, and builders are experiencing a boom in real estate sales. For many people that depend on real estate to earn a living this all sounds too good to be true, and I am of course one of these people. However, in my job I provide many types of Angry Buyersreal estate service.  Here at 5Market, we assist sellers, buyers, investors, tenants, and business owners because they all have real estate needs.  And while many sellers are very happy these days, there is an equal amount of very frustrated buyers.

Currently, several neighborhoods are highly competitive.  In many cases, properties are going under contract before most buyers get to set foot in the door.  Two prime examples of this are Normaltown and Forest Heights.  Normaltown has many varied and unique properties which appeals to a wide range of buyers.   But it seems now that a buyer needs an insider tip to find something in this area.  Additionally, Forest Heights, which is located on the other side of Hawthorne, offers houses well below $200,000.  As a result, properties have been flying off the market in Forest Heights over the last several months.  These are just two areas where buyers are experiencing

Normal Hardware On Prince Ave
Normal Hardware On Prince Ave

frustration, but they are many more examples throughout the Athens area.   Meanwhile, there are still some areas and price points where the sellers are not always in control.   For example, people that are selling a property in Oconee for over $500,000 probably don’t think it is a “seller’s market”.  This doesn’t mean that no one is buying over $500,000, but that fewer buyers are able to afford this range.  Furthermore, many neighborhoods in west Athens are not seeing the appreciation they probably deserve.  The Timothy road corridor is full of great neighborhoods that still offer a lot of house for a reasonable amount of money.  But in the end, it always comes back to supply and demand.  The trends change from time to time, and right now it is trending towards our in town neighborhoods which is driving up the demand.

All that being said, what does it mean if you are a buyer in this market?  Well it means you should keep the faith, remain patient, and keep looking.  We all know that these property values cannot grow to infinity.  At some point, the market will level off or even come down a little.  But that doesn’t mean buyers shouldn’tdownload purchase.  The biggest reason buyers need to buy now are the interest rates.  If you can find a rate below 4.5% or even below 4%, you need to take advantage.  It is impossible to know what will happen with Athens real estate over the next 20 or 30 years.  But I know that they aren’t making any more land, and rates will have to go up at some point.

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An Early Spring in Athens, GA

Lately, the weather here in Athens has been downright COLD.  Earlier this week, it seemed like Athens was stuck in a large snow globe.  Sadly, the ground was not cold enough so it couldn’t really accumulate.  Therefore, nobody missed work, and all the kids had to go school.  But despite the chilly weather, the real estate market remains hot.  Traditionally, most home buyers get into the market around spring time.  This makes sense because many homebuyers prefer to move in the summer if possible.  Moving can be a lot of work for anyone, but it can be especially difficult when jugging children and school.  Subsequently, many people don’t place their homes on the market until April.  This has created what we refer to as “The Spring Market.”  And year to year, most realtors see a lot of activity between April & July.  Historically, the market drastically slows down once school starts.  However, there are years when the spring market starts early, and 2016 is one of those years.

There are various factors that can cause an early market.  Right now we have some interest rate risk, an upcoming election, and locally some areas have a shortage of available properties.   Interest rates are still very low, and I download (2) don’t foresee them jumping up drastically.  Nevertheless, they will have to go up sometime.  Furthermore, we have a huge presidential election in November.  At the moment, it seems wide open, and there is no telling who’s going to win.  Those are issues that impact the whole country.  But real estate is a very local business.  So what’s causing our market to start early?  Well there a lot of causes.  Right now in town areas like 5 Points and Normaltown are very popular with buyers.  But there are not many properties on the market in these areas which makes it very competitive.   This popularity has been created by several factors.  First of all, Athens is now a retirement town.  So many people are choosing Athens as a place to retire.  Many of these of retirees went to UGA,retire-early and are coming from the Atlanta area.  And in most cases, they simply want to live at a little slower pace while not sacrificing the amenities of a large town, and Athens fits that description perfectly.  This being the case, many of these retirees want to live “in town”.   Additionally, we are seeing some of the younger generation opt to stay in Athens.   Over the last 20 years, many families have moved to Oconee County for numerous reasons.  More space, more affordability, and the schools.  While Oconee County remains a great area for families, more and more folks are trying to stay “in town”.  This is a great thing for Athens and Oconee because both areas need young families in order to thrive.   Lastly, these low interest rates continue to drive our market.  The rates are giving people opportunities they would not have had back in 2005.  As a result, the banks cannot offer good rates on investment money.  Since rents are trending up, investment real estate is also doing well in our area.

In closing, I would like to briefly mention the housing study that has been in the paper recently.  You may or may not be aware that Athens Clarke County recently paid an outside firm to conduct a housing study.  I have included a link to the article in the Athens Banner Herald for reference below.  I will not go into great detail, but I would like to say that the information in this study is misleading, and it does not represent the market accurately.  It is frustrating that our government has paid for a study that any good real estate broker could have done in a couple of days for much less money.  Oh well, that’s just my two cents.

If you have interest in discussing the market or real estate needs, please don’t hesitate to contact me or visit our real estate brokerage, 5 Market Realty.

Athens Banner Article on Housing Study

Athens Area Real Estate: 2015 in Review  

Well here we are at the end of another year, and pretty soon 2015 will be over and in the books.  As I get older, I find the old sayings are often very true.  For instance, people often say, “The older you get the faster time seems to move”, and I totally agree.  Maybe it happens because we get busy or maybe we just get accustomed to time.  Regardless, it seems to move faster and faster every year.  Just 5 years ago, I was single with no children.  Now I am married with 3 kids, a dog, and two car payments.  And of course, I wouldn’t trade it for anything, but how in the hell did this happen?  Honestly, my 29 year old self would be blown away if he knew how fast his next 5 years would go.  It really does move fast, but it is a lot of fun as well.

I always enjoy looking back at the year.  And the end of the year is always full of TV shows and specials that review what has happened over the past year.  In addition, you can also always find a good amount of best and worst list too.  With that in mind, why not take a look back with regards to real estate in the area.

5 Points Clockeditededited
5 Points Athens, GA

Overall, you could say 2015 was a great year in Athens with the exception of Georgia football.  But that’s a subject for another post.  And you can rest assured I will write that one as well.  This year we saw the real estate market continue to thrive throughout most of the area.  Centrally located areas like 5 Points and Normaltown have become competitive markets.  As I mentioned before, both areas are seeing a lot of renovations and flips.  In Normaltown, you may see prices around $175 to $180 PSF at the top of market.  While some parts of 5 Points may achieve values over $200 PSF.  These prices are of course great for sellers, but can pose challenges for buyers.  I am glad to see this appreciation, but we need to be cautiously optimistic.  Location is

Normal Hardware On Prince Ave
Normal Hardware On Prince Ave

the driving factor for Normaltown and 5 Points and that is not going away.  But the current low interest rates have also played a major role in this market.  While I do not expect rates to go up drastically they will probably tick up a little bit over the next year.  No one has a crystal ball of course, but these two areas will surely remain popular in the years to come.

 

The Eastside of Athens has also experienced some appreciation, but overall the prices on the Eastside still provide a good value for a buyer.  Without a doubt, there are some areas on the eastside that need to improve.  But many neighborhoods are doing very well, and the Vet School is just another positive for the area going forward.   Moving a little further out is also a good option for buyers.  The west side of Athens has also seen some appreciation, and great older neighborhoods like Kingswood and High Ridge are still doing well.  Lastly, Oconee County continues to grow and reap the benefits of more space and good schools.  Oconee remains a fantastic option for families, but there is still a large supply of buildable lots in the county. As a result, appreciation may move a little slower in this area.  In general, Athens residential real estate had a good year in 2015.  But what about commercial and investment real estate?

IMG_3196
Epps Bridge Centre

When it comes to commercial real estate in the Athens area, it’s impossible not to talk about Atlanta Highway & Epps Bridge Parkway.  Most people in the area consider the Epps Bridge corridor to be growing and Atlanta Highway to be declining.  The growth on Epps is great for the area and Oconee County will benefit from the taxes.  However, much of the growth on Epps came at a cost to the Atlanta Highway corridor.  Basically, many big box retailers moved from one road to the other.  While the Epps Bridge area has grown significantly over the last couple of years, we should not be so quick to dismiss Atlanta Highway.  I think this will be a temporary setback for Atlanta Highway because the area has too much traffic not to attract more business.  In fact, there are some projects underway that will bring more customers, and other plans are in the works as well.  In reality, both of these roads are positioned for success. It’s important for everyone to understand that Athens and Oconee are not in competition.  They need each other to be successful, and if we are not smart with growth we may turn ourselves into a congested Atlanta suburb lacking in charm and character.   That being said, downtown Athens is another market to watch when it comes to commercial real estate.  And in 2015, we saw  a lot of changes to the area.

Welcome-to-Downtown-Athens
GA Theatre Downtown Athens

Downtown represents the heart of Athens.  It hasn’t always been this way, but in the 90’s we saw more restaurants, shops, and bars come into the district.  Since then it is been a huge asset to Athens and one of the areas that helps make Athens unique.  Nowadays, it seems to be the most popular area for development.  There are so many things going on downtown it is hard to keep up with at times.  Commercial real estate has done well and overall rental rates are up.  However, this is not always a good thing for everyone.  I am happy to see any business small or large be successful in downtown.  But I never want to see Athens lose its local and small town feel.  Recently, we have seen some larger stores like J. Crew and Urban Outfitters come into downtown.  This is good for real estate, but I hope we are able to keep our small local stores as well.  And maybe one day we might see some form of a grocery store for all these new residents in the area.

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The Standard in Downtown Athens

Lastly, you can’t talk about Athens real estate and not discuss student housing or investment property.  And it seems all the students want to live downtown, and developers are rushing to fill the need.  Recently, we saw “The Standard” become the first truly high end student housing development in the area.  It has been tremendously successful, and now “The Mark” is underway on the old Armstrong Dobbs site.  ‘The Mark” will be another high end development, but will also include commercial space some of which will be used for offices.  These are just two examples, but there are many more student housing properties that are either already developed or on the way. Only time will tell if there is enough demand for all this housing.  Nevertheless, the new developments downtown currently achieve a very high rental rate.  This has had a positive impact on some other student properties or investment real estate.  For example, Athens has a good bit of cottages or small houses that are dedicated to students. Many of these locations have seen rents go up over the past year.  It is only natural that investors and property managers would try to grow rents.  But the high rental rates downtown seem to have created a “perceived value” at some of the other more affordable locations.  Subsequently, I have seen many investors get back into the market purchasing more properties as a long term investment plan.

In general, 2015 was a good year across the board for real estate in Athens.  However, we are not too far removed from the lows of the mortgage crisis.  Therefore, our gains in real estate may seem a little bigger than they are in reality.  Nevertheless, you should feel good about the current state of the Athens market.  Let’s just hope 2016 keeps us on the same track despite outside factors like the election, interest rates, and health care costs.  Happy New Year!

If you have any questions or real estate needs, please don’t hesitate to contact me or visit our real estate brokerage, 5 Market Realty.

UGA’s Impact on Athens Real Estate

This blog hasn’t been up for very long, but if you have read even a couple articles you should be able to tell how much I love the city of Athens, UGA, and especially Georgia Football.  While this blog is officially dedicated to Athens real estate, it is already apparent that Georgia athletics will always be a major topic for many posts. Arch For me, it is impossible to live or work in Athens and not care about the university and its future.   Here in Athens, we are so fortunate to have this great university right in the heart of our town. Small college towns are often unique and vibrant communities throughout the entire country.  I am of course somewhat bias, but I don’t think there are any better than Athens, GA.  The university brings so much to our town it is hard to really quantify.  It impacts our entire economy, and therefore it also impacts our real estate and its value.  With that in mind, I thought it would be a good idea to explore and discuss some of the ways UGA impacts Athens real estate.

First of all, the university brings stability to our local economy.  UGA has an enrollment of around 35,000 students.  That doesn’t include all the staff, and professors employed by the university which makes it an incredible employer and engine to the area.  The university isn’t exactly the kind of employer that is going to pack up and leave either.  If the University of Georgia goes out of business we will likely have bigger problems in the world than a lack of jobs.  So it brings people and jobs, but how does that effect Athens real estate.  Well obviously, it has a positive impact.  There are so many ways that UGA influences the real estate market that it is hard to cover entirely.  Maybe the best approach is to discuss UGA’s impact on residential, investment, and commercial real estate throughout the area.

Residential property is generally any property where people reside.  This could include your house, a condo, or an apartment complex. But for the purposes of this discussion we will classify residential property as a house in a residential neighborhood.  In previous posts, I have discussed residential markets in Normaltown and 5 Points.  Both areas of town are seeing a good bit of renovation and growth in value.  The driving factor behind this is location, and what makes their location desirable is their proximity to the university.  On the other side of Athens, the university has a similar impact on the east side of town.  As I mentioned earlier, the east side provides buyers with a different type of value.  Basically, more bang for your buck.  In addition, the east side is now DSC04143editedhome to the Veterinary Medical Center which is yet another example of the university impacting the area.  UGA is the heartbeat of Athens.  So many things center on it like employment, education, and entertainment.  It is only natural that people would want to reside in close proximity.  This creates a demand which in turn can increase property value.  Nevertheless, residential neighborhoods that are located a little further out benefit as well.  Just look to the growth in Oconee.  The Watkinsville area has become a very desirable place to live thanks to the new homes and good schools.  Many of the people that purchase homes in Oconee either work for UGA or have businesses that benefit from the school.  So whatever the value of your home is today just be glad it is in proximity to UGA because if not it would likely be worth less.

In many cases, commercial and investment property can be thrown into the same category.  Commercial real estate involves properties that are used for business purposes like retail stores, restaurants, or office space.  Almost every business owner in the area has to have a commercial space to operate their business.  For example, Athens is blessed with a unique downtown filled with bars, shops, and restaurants.  Downtown Athens is located right next to UGA’s north campus which is a major reason the downtown area does so well.  Every restaurant Welcome-to-Downtown-Athensdowntown depends on students, professors, and parents to make money.  Every retail space downtown needs students to shop in their store.  Every bar owner needs students to hang out in their bar to be successful.  If you think about it, without UGA downtown Athens would likely have a lot of vacant space.  In fact, how do think local retailers feel about Georgia football?  If they are smart they want Georgia football to succeed.  The better UGA does in sports the more people come to visit.  Consider a restaurant owner or bar owner during the football season.  They need that business to thrive, and without Georgia football many local businesses may not be here. But downtown is just one example of UGA’s impact on commercial real estate.   Go a little further out, and look at the Alps road area or the development around College Station.  Those are more examples of thriving commercial locations thanks to UGA.  So remember the next time you are eating in your favorite restaurant that it is probably still in business thanks to the university.

While most commercial properties are often investment properties, many residential properties are used for investment as well. When it comes to rental or investment property the correlation with UGA is fairly evident.  The student population provides a huge rental market in the area, and many people purchase residential properties to rent as an investment.   This market can be a little tricky from time to time because rental properties and their income are more sensitive to outside factors.  For instance, a property’s income will change over the years based on its age and the overall supply of housing.  In the end, the same old rule applies.  The better the location the more likely a property will have a higher return and higher value.

Here at 5 Market we are no different.  We work with residential, commercial, and investment properties that all benefit from UGA.  Truthfully, this information should be fairly evident to most people.  But sometimes we all need a reminder of how lucky we are here in Athens.  So be thankful to UGA, and be excited a new coach is coming.  Because even Georgia football is important to our real estate.

If you have any questions or real estate needs, please don’t hesitate to contact me or visit my real estate brokerage firm, 5 Market Realty.

Athens, GA Real Estate: Where to Spend Money in Your Home

Here in Athens, real estate seems to be doing very well. Another area that is currently thriving is construction.  Builders are back building new homes, and contractors are booked up for months.  It seems that there are renovations going on all over town, and it is definitely a good time to be a contractor.  As we all know, supply and demand are tied together. under-renovation Therefore, if the demand for contractors is higher than you should probably expect the cost to be higher as well.  Conversely, if you look back to 2010 the cost was lower due to the lack of demand.  As I mentioned before, the 5 Points and Normaltown areas are seeing a lot of renovations and remodels.  Depending on your taste, you may or may not like the trend.  But trust me when I tell you that it is a good thing for our community.  When people invest in their home it is a sign of confidence in the market.  It also a good sign when builders invest in properties.  However, the one thing to watch out for is supply.  You never want to see the supply greatly exceed the demand.  All that aside, many homeowners are taking advantage of the low interest rates and investing in their homes.  This is great to see, but it is an area that many homeowners need advice because they often make mistakes.

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Property Brothers on HGTV

Thanks to the wonders of HGTV, many of us watch remodeling shows all the time.  The problem with these TV shows is that they are just that…TV shows.  For instance, Bill Cosby made raising kids seem fairly easy and often humorous.   Well it is often funny, but it may be one of the hardiest things a person will do in their life.  TV shows are not always based in reality.  This is especially true with so called “Reality TV Shows”.  If you pay attention to the credits in some reality shows they give credit to “writers”.  How in the world can a “Reality TV Show” have a writer?  My point is that these shows are fun and entertaining.  They are good for giving us ideas, but keep in mind that what works in California may not work here in Georgia.  HGTV-showchip-flip-or-flop Too often homeowners get excited and spend money in the wrong areas.  So where should homeowners spend money in their house? In my opinion, homeowners should focus on three main areas when upgrading or investing in their property.

  • Maintenance
  • Livable Space
  • Up Dates

First, you must spend money on maintenance.  This is commonly overlooked by a majority of property owners.  You absolutely have to maintain your property. Maintenance comes first no matter what.  It makes no sense to put in cultured marble if you have rotten windows.  The issue here is that most people don’t see the deferred maintenance.  But they can easily see a new bathroom.  If you do not maintain and upkeep your property it will definitely cost you money in the long run.  The next area that owners should focus their money is in the main living area or even adding more livable space.  Everybody seems to focus on bathrooms and the owner’s suite.  And these can be good areas to put money if you have it to spend.  But be warned that you may not get it back.  You need to be careful with how much you spend in areas like a master bedroom or bathroom.  In some cases, it is smart to upgrade them or make them larger but you can overdo it quickly.  You need to understand that people don’t live in their bathroom or bedroom.  They sleep and shower there, but they live in the rest of the house.  Buyers want large and functional kitchens with open living space.  Any outdoor living space is always a huge plus as well.  Storage can be a big plus, and if you want to expand a master it would be wise to make sure the closets are spacious.  Lastly, it is important to keep your house up to date or least keep it from becoming too dated.  Some older houses have fantastic space, but they have not been touched in 30 + years.  Therefore, they eventually sell at lower price because the entire house needs updating.  Which creates a good opportunity for a buyer to purchase the property low.  I am not suggesting that you remodel your kitchen and redecorate every 5 years.  However, if you are in your property for 15 years you may need to update a few things.

In closing, you will need to spend money on your home no matter what.  At the bare minimum, you need to maintain the property.  But if you take it a step further and renovate.  Be sure to do it wisely.  In the end, your home belongs to you, and you can decorate or upgrade it any way that you see fit.  But if you ever plan to sell it would be smart to consider future buyers.

If you have any questions or real estate needs, please don’t hesitate to contact me or visit my real estate brokerage firm, 5 Market Realty.