Thoughts on Athens-Clarke Property Taxes

I haven’t written one one of these blog posts in a good while.  I have been blessed to be busy over the past several months with work, family, and other things in general which makes it hard to find time to write anything someone might read.  I will try to keep this one brief, but the topic is something any Athens-Clarke County resident should read. Please forgive my grammar as it seems to get worse with age.

As you are probably aware, our real estate market has seen an unprecedented growth in area real estate values over the last several years.  Home prices are way up, and in many cases far above the high values achieved before the crash of 2008.  Furthermore, multi-family properties are producing higher rent revenues  along with many commercial properties in the county.  Overall, the market is strong, but it has placed a stress on many first-time home buyers.  Long and short, when values go up less people can afford to buy or own a property. This is a common problem in large cities, but it is more rare in smaller communities.  By and large, this a very good thing for Athens.  It means our area is desirable and it creates more taxable revenue for the county which brings me to my point.  Clarke County property taxes will be going up yet again unless our commissioners revisit the county millage rate.

In case you don’t understand how property taxes work here is a brief explanation.  All the land in a county is divided into parcels that can be identified, owned, and taxed by the local government.  There are exceptions of course like the University of Georgia here in town which does not have to pay property taxes, but in general any privately-owned land will be taxed.  These taxes help pay for many county services and fund the local schools, so they are very important to our citizens.  Every year the county assesses a value to each taxable parcel and that value is used along with a millage rate to levy taxes on each property and its owner.  Our current millage rate is 33.95 but that can vary depending on the area of the town.  Over the last five or so years the taxable value of Athens-Clarke County property has increased well over a BILLION dollars.  While I don’t have access to the exact numbers, it is a reasonable to assume that it is well into the billions.  This is mainly due to property appreciation and not just the new construction of homes.  We do have new construction of course, but there is limited land for development in our county due to its size and land allocation.  In short, the average home owner has likely seen their property taxes increase by more than 50% over the last four years.  Most of the time, this is great news and good for our area, but I would like to point out that found money or increased revenue doesn’t have to become spent money.  Our property tax revenue is large and we already have a couple of SPLOST sales taxes in place for other projects in our community.  I am not advocating against our property taxes, but I do think it is time for our civic leaders to evaluate the county’s budget and consider a reduction to the millage rate.  All increased tax revenue doesn’t automatically have to be spent or consumed.  I think it is reasonable for our residents to see some relief in the increase of their property taxes while still providing all the services Athens has in place along with other things we might need to improve upon.  You may disagree and if so, that is A-Okay , but if you are a Clarke County home owner you have undoubtedly noticed these tax increases.  Even if you do not own a home, but instead rent property I can assure you that your landlord if able has passed down these taxes to you in the form of HIGHER RENT.

In closing, I don’t expect our leaders to roll back the millage rate.  In my experience, government tends to spend rather than save.  Nevertheless, I would be pleasantly surprised to see it happen.  Therefore, I plan to contact my district commissioner to ask that she and other commissioners consider this idea before implementing a new budget that uses all the increased tax revenue, and I encourage you to do the same.  If you would like to contact your area commissioner, please click on the link below and you can find the information.

https://www.athensclarkecounty.com/168/Commission-Information-Biographies

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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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Sellers Beware Predatory Buyers & Misleading Marketing

Unless you have been living in cave like a hermit, you are probably aware that the local real estate market is doing well.  Here in the Athens area, we are seeing a return of value in the condo market along with increased values in the traditional housing market.  I have expressed my thoughts on these gains in past posts, but overall there are many factors helping our market.  Interest rates, population growth, low supply, and the overall economy are some of the main factors.  We are even seeing a historically low supply in areas of student housing with Cap Rates below 7%.   At this point, I have not seen a dip in the demand or jump in supply so I think the market will hold for a while longer barring any unforeseen changes in the economy.  This is all good news for property owners and sellers, but when the market is strong mistakes can still happen.  One of the biggest mistakes I see sellers and property owners make is selling under value.  This usually happens one of two ways.  The seller is either desperate and needs to sell quickly or they have been misled by a “predatory buyer.” In most cases, if someone needs cash quickly they have to take a lesser price to speed things along.  This is unfortunate but a reality.   However, what bothers me is when an investor or even other real estate agents use deceiving practices to buy or list a property.  Allow me to explain:

I am sure most of you that own a property have received something in the mail where a person or a business claims “this is my final offer” or “my last attempt to buy your house”, and the worst one “please call me about an urgent matter concerning your home”.  In other cases, they simply explain that they buy homes and have an interest in your property.  Most people understand that these people are willing to buy, but only at a price that makes sense to them.  And that price is usually low.  Let me be clear that some properties that are not kept up or have an obsolete floor plan do provide good opportunities for people to add value and flip the house.  I would not call this predatory, but simply seizing an opportunity.   On the other hand, we are starting to see a new model in larger cities where people will buy your house in cash to help you move.  In theory, this sounds like an intriguing new model in the housing industry.  However, I would have some reservations before entering into one of these agreements.  First of all, people are usually in business to make money.  And people can’t always make money if they buy your property at fair market value.  I understand this business model attempts to provide some certainty, but it may leave you with less money.  If you are considering this please take the time to ask some questions.  For example, how did they arrive at the purchase price?  What will they do with your home after they buy?  Are there any extra fees? How long have they been in business?  Please take the time to research the process before you agree because if something sounds too good to be true it often is too good to be true.

Lastly, there is another method that agents might employ to gain business.  In some areas, we see real estate agents offering to buy your house if they cannot sell it for you.  This tactic is really frustrating for me as a realtor, a broker, and business professional.  I take what I do very seriously, and I work hard to do it with integrity and class. Therefore, I would never purposely mislead someone with regard to my services.  I have never listed a house with an agent that promised to buy it, and I am not personally aware of any realtors that have bought a client’s house in one of these agreements.  That doesn’t mean it may never happen, but based on my experience it seldom does.  Working in real estate is extremely competitive, and agents need to be aggressive in marketing not only to gain business but to help their clients.  So please beware a realtor that promises to buy your house if it does not sell.  In most cases, this is likely a bait and switch tactic. They simply want to get their foot in the door so to speak.  If you call them they may very well agree to buy your house, but I can assure it will be at a price well below its value.  As I stated before, people are in business to make money not to lose money.  And they cannot make money on your house if they pay too much for it.  If you choose to call a realtor because they promise to buy your house, do the same thing and ask some questions.  How much will they pay for the house?  How did they arrive at the price?  What will they do with the house if they have to buy?  How many houses have they actually bought?  In closing, I would like to make sure property owners educate themselves when selling and make sure they read the fine print.

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Athens Real Estate is Booming:  Will it Last?

If you live in the Athens area then you probably know our real estate market is booming.  Granted, there are a few pockets and price points that have not performed too well, but in general the market is thriving.  I recently wrote an article about Athens home buyers where I described the current frustrations of home buyers in this seller’s market.  Over the last several months, I have had many people ask me what I think is driving our market and how long do I think it will last.  In reality, no one knows for sure, but when asked I try to give an open and honest opinion based on what we see in the market on a daily basis.   This morning I find myself in the office looking out the window while Athens is under a tornado watch and flash flood warning.  This being the case, it seems like a good use of time to write a post and share my thoughts on this topic.

For many of us, the past mortgage crisis and real estate bust is ever present in our mind, and that influences our caution or even pessimism about the future.  Nevertheless, it doesn’t’ mean we are heading that way once again.  A wise man once said, “Those who do not learn from history are doomed to repeat it”.   With that in mind, I think it would be smart to consider the Athens market before the last recession.  I began my career in real estate here in Athens right after graduating from UGA.  It was the early 2000s and the real estate market was strong.  It is fair to say I was pretty green when I started, but with a little hard work along with some help from others I was able to find a little success and make a living.  Nowadays, I am a little older, a little heavier, and a lot wiser.  And I have found that my experience of living through the recession has really helped and given me a good perspective on where we are now in Athens real estate.  I am sure many of my colleagues feel the same way.  That being said, what was going in real estate before the bust?  And how does that compare with what we are seeing now?

Well I can only speak to my personal experience during this time with regard to what I saw in Athens real estate from 2003 to 2009.  At this time rates were not too high but they definitely were not this low.  In some cases, prices were even higher than they are now.  I saw condos finance with ease at prices that have still not returned.  I saw numerous people move towards Watkinsville for schools, more land, and 3,000 plus square feet.  While 5 Points was still very desirable it was nowhere near as popular as it is right now.  In fact, many areas of 5 Points were heavy with rentals for students.  As for Normaltown and Boulevard, they were also filled with rentals and prices per sq. foot much lower than the $175 to $200 we see today.  I often heard clients refer to 5 Points as overpriced and out of date.  To quote a past client, “Why would we pay $300,000 for a 1950s kitchen and no closet space?” Overall, it seemed more and more Athenians were moving out and into newer subdivisions.  We all seemed to think real estate values could never go down, and most folks outside of our industry had never heard of loan terms like sub-prime, no doc, stated income, and the dreaded adjustable rate.  Lastly, it seemed every builder believed “if you build it they will come”.  Looking back I did a lot sitting in neighborhoods asking myself, “Where in the hell I am going to find all the people needed to buy these houses?”  So what is different between then and now?  The major difference between then and now is the Supply and Demand. Back in those days I never saw anything that resembled what I am seeing today.

Many things have changed since the “Great Recession”.  First of all, we all know low interest rates have helped and they continue too.  While we should expect rates to increase, I don’t think we will see anything drastic in the near future.  Interest rates aside, I think the major difference seems to be the demand for housing in our area.  While the University has not grown significantly, people’s desire to live and work here has increased greatly.  In 2005, if a client asked me to find them a home in Athens under $250,000 the options would greatly exceed what you find today.  There would even be feasible options in 5 points and Normaltown.  In the end, the supply was slightly ahead of the demand back then.  Not much but a little.  Nowadays, we have a scarcity of affordable in town housing, and sadly I don’t see that changing anytime soon.  This demand has been created by numerous factors.  Athens as a whole has become a retirement destination to people in Georgia and across the country.  We have a vibrant college town that offers great food, better music, and a good quality of life. Thanks to technology more folks are able to work away from their office in Atlanta which has brought even more people into our area.  I personally have worked with 4 clients in the past year that work inside I-285, but have chosen to reside here in Athens.  Furthermore, our in town neighborhoods just have more to offer now than they did in 2005.  You can walk to dinner and drinks in many areas, and the shopping is better from the Eastside clear across to Epps Bridge.  As I have mentioned before, HGTV shows have influenced numerous people over the years and have helped create many remodels in our area.  While these remodels and tear downs are not always popular with everyone they are a sign of strong local market where demand is way out in front of supply.  To further this point, just look to the recent moratorium on new development in Oconee County which could have a similar impact on the housing climate in Watkinsville .  I do not have a crystal ball, but I think our residential housing market will remain strong in the near future barring any unforeseen national crisis or drastic jump in interest rates.   As for our student housing market, well that is probably better discussed in a future post.  In closing, the market is strong and shows no signs of weakening at the moment, but that doesn’t mean you can buy anything anywhere.  You still need to consider all the factors to purchase wisely.

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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