Atlanta West - Bad Place to do Owner Occupied Properities?

Question

Hi everyone.I'm an RE newbie so I'd like to pick your brain a bit.I've been looking at multi-family homes for my first investment and I found a good place on the West side of Midtown.The good thing about this duplex is that it is 10-12 min drive to Georgia Tech, and 5 min. walk to the station. The property is gated and in great condition, and most importantly, it is within my budget; however, the neighboring houses are in shambles. There is a burnt down factory righ across from it, and the two neighboring houses are vacant.I plan to rent out one unit, while I live in another.And in 1-2 years, move out to my next unit.The unit is next to Maddox Park, on Pierce Ave NW.I know most people stayed away from Westside because people feel it's an unsafe area.Does anyone own property in this side of town and give me your thoughts on owning/renting properties in this area?

Marc Bazemore · Answer

Great points! if its in your budget then go for it ! weigh out the risk ,come from a worst case scenario approach , the most important thing in my opinion is screening the tenant,i have 2 properties near the West End Mall close to Fort McPhearson,even though its a low income area dosent mean that all the tenants are bad or don't pay ,you just have to find them ,I did and I'm far from being some kind of guru Good Luck!

Rick Baggenstoss · Answer

@eric feng I admire your line of questioning but you're not going to get a good response here. This is a very personal thing and it requires an unusual level of local knowledge. You know you're taking a risk, right. You know what the risks are? You've contemplated realistic returns? Is it worth it? Most importantly, how can you mitigate some of the risks? Keep working on this.

Account Closed · Answer

Over the years, that area of ATL has earned it's sordid reputation. Thomas Jefferson said, "don't buy something just because it's cheap." I take that to mean that being within your budget shouldn't be the determining factor. Some people don't mind the hassles that go with living in a rougher urban neighborhood, while other folks get scared-to-death when a benign funky smelling old guy walks past muttering to himself. Is it a good investment? Can you find long-term quality tenants? Will it cash flow? Is there appreciation in the neighborhood? Have you checked the crime stats on Trulia? In a pinch could you sell it within 60-90 days? And the big question for In-town ATL is IS IT NEAR THE BELT LINE?

Anna Watkins · Answer

@Eric Feng -- Maybe East Atlanta used to be similar to Westside, but not in the past 25 years. EA was groovy/hip 20 years ago, with edgy restaurants and The Earl, destinations that attracted tenants and flippers. Bankhead Highway 20 years ago had transvestite hookers getting beat up by outraged frat boys who picked up the wrong trick. The trendiness in the Westside north of this location (Marietta St/Howell Mill) is all factory lofts and apartment buildings, at least as far as I see. I wouldn't think two years is a realistic timeline for this area.>> I just looked at what I think is the property in question on Google Maps -- seems somewhat 'fish out of water," plopped right there on a street with nothing else going for it, and the vacant properties don't look like flip material. They're more like scrape-and-builds, and that comes years after flippers start work. IMHO, if you want a better first investment, buy a $60,000 SFH in Candler/Macafee/Belvedere/Columbia and get a roommate. Or Adair Park/Pittsburgh -- closer to Beltline & impending development. You'll be able to move out and on much faster.

John Teachout · Answer

Would you be occupying the property? If so, make sure it's an area you would feel comfortable (safe) in.

Eric Feng · Answer

Thank you everyone for your advice.! Account Closed Thank you for those great questions, which prompt me to do more research. According to Trulia, it's a relatively safe light green neighborhood, (Midtown is showing up as an dangerous area in red though). An actual visit to the place, gives me the opposite impression. Just by driving by, the neighborhood feels unsafe and may deter away potential good renters. I doubt it can be sold quickly 2-3 months. It has been listed on Zillow for 831 days, and the price doesn't seem right. The single 3/1 single family homes in the area remains low at around 3-40k, while this duplex is asking for 130k. The appreciation seems slow by looking at the neighboring house history. However, it is near the Beltline! Which is also one of my motives for the purpose. According to the Beltline project map , the trail will connect both Washington Park and Maddox Park and the westside, and the duplex is located in between these two parks. However, the question is, when does the construction start and finish?As for the other big question, is it a good investment? I definitely more experience coming up with a more accurate result. Currently, BP calculator is telling me no... even if I buy the place at $80k. So I've decided to sit on this property and see how will time change the situation.@G a Gloster I'd love to hear your experience on investing on the Westside, including both success and horror stories. From what I heard, East Atlanta used to be similar to Westside, but now it's getting better and better, thanks to fix-n-flippers. So that's why I always feel Westside has potentials, especially those areas closer to Midtown. But I will definitely take your advice and talk to the enforcement officers to find out more info and keep a close watch on this property.

Linval T. · Answer

@Eric Feng - This is a question that you will definitely need some soul searching to get to the final answer....it's not as easy as Jeopardy! It will result in you formulating the decision based on your head and not your heart.Account Closed made some excellent points coupled with great questions that will help you put this thought/purchase to rest one way or another.Good luck with your decision and keep us posted on the outcome one way or another.

Allen Thomas · Answer

Don't do it. Lol That's all I have to say about that. For 130K you can do way better than that area, both in terms of investment property numbers and quality of life, since you'll be occupying the property.

Justin Fernandez · Answer

if your budget is the issue, check out beltline.org. If you meet the housing requirements, they will make the down payment and you own the loan. I think they even forgive it after 5 years. Worth a look if you meet the requirements. If you're looking there, you might as well give it a go.

Anna Watkins · Answer

My son played ultimate in Maddox Park, and I drove around a bit a few times. Bankhead Highway has a seriously notorious reputation/history, so I think it would be a somewhat risky investment for the short term,. And you can't count on that neighborhood booming as quickly as some others -- it's close, but not right ON the Beltline (what's the "tour route"?). It's all over sketchy -- but intriguing. Are YOU comfortable living there? Because to make it work you might need to be on site for a while. Does it have perks for you (proximity to Tech + price?). Do you have connections to find quality tenants (Tech grad students?) willing to brave the location for a nice interior, short commute and affordable rent? What about trying to buy the vacant units on either side, and bringing up the street yourself?