First time investor / need market advice
Hello all! I’m a recent addition to the BP community.
My wife & I recently moved north east of ATL in the Buford area. We are in our mid twenties and determined to get into the REI game as soon as possible. We have been looking specifically for a duplex or SFH where we could potentially finish out a basement with a 203k loan to use for a house hack to get our foot in the door. We thought we found a deal yesterday where the basement was already on par with what we wanted and that deal was under contract in less than an hour from hitting MLS. We were the second person to call and the first person who called got it (rats).
With that being said, the market in our area seems pretty crazy right now. We have a fantastic real estate agent, and yet, every reasonable deal is going off the market in less than a day. Most properties are selling for
50-70k higher than they were just 6 months ago, which has caused some hesitancy in my newbie self.
My question is - should we be hesitating over this? I do not want to have analysis paralysis but I also don’t want to be guilty of buying in at the high point and losing $ if the market comes back down to earth in a couple of months.
Again - we are really new to all of this so any help would be greatly appreciated.
Most Popular Reply
Hi @Noah Herrin and welcome to BiggerPockets!
I completely agree with your assessment that the Atlanta market is "pretty crazy" right now! I'd even go so far as to say it's severely overbought, with a lot of "not-so-smart" money pouring in from all corners.
That said, here are two considerations that might cheer you up:
- "Under contract" and "closed" are NOT the same thing - While you might have been the second person to call, that first person still has to get through due diligence inspection, appraisal, and loan underwriting before the property gets sold. You'd be shocked just how many deals fall apart somewhere along this road. Stay in close contact with the agent, checking in at every major milestone. Also, see if you can get in position now with a backup contract. It's true: The fortune really is in the follow-up!
- Today's winner often becomes tomorrow's loser - You might consider tracking down some of the buyers who overpaid for property a year or two ago (your agent can do this), and see how they are doing now. Again, you would be amazed how many newbie investors over-pay for a property, botch (or vastly underestimate) the renovation, and then run out of money and steam. A savvy investor might swoop in, buy these properties at a discount, and put these folks out of their misery. Just sayin'...
Happy hunting! (Call me if you'd like to talk more about the Atlanta market!)