All Forum Posts by: Ben Firstenberg

@Josh Bowser is spot on. 

One thing I'll add... the city is growing and changing very quickly. The development (or gentrification) is rapid and uneven. This creates opportunities for fix and flips. You can have broken down ranch homes next to million dollar new builds in many parts of town. 

 Thanks!

Agreed 100%. The appreciation, loan pay down and tax benefits make it such a great deal compared to renting. 

Hello all, I'm an agent in Atlanta who works primarily with investors. I see a lot of posts on here asking where to look for deals and thought maybe it would be helpful to summarize what I know and what I'm seeing today. For this post, I'm going to focus on house hacking. 

The most successful house hacking strategies today seem to be rent by the room or buying a house with an in law suite. 2-4 unit homes have run up in price to the point where it's difficult to find one that works. It's difficult to find a "perfect house hack" where your living expenses are exactly $0. Typically a major win is to reduce your housing expense to $500-1000/month. That way, you're still saving money on housing AND when you move out your property will be cash flow positive. 

Three locations I recommend looking into:

1. Austell/Mableton/Powder Springs/Hiram/Lithia Springs -- this pocket on the NW side of town has some great deals for house hacks. You would be surprised how strong the rental demand is in these places, and the prices are very reasonable. You'll be living a little further outside of town, but there is still plenty of retail and amenities. 

2. Marietta -- Deals will be a little bit harder to find, and will be more competitive. But prices are still reasonable and the location is very strong. The proximity to the perimeter office/retail centers will be a big draw, as well as downtown Marietta itself. 

3. Norcross/Duluth/Lilburn/Tucker -- this pocket also has some great house hack deals. Prices will be a little bit higher, just due to proximity to the perimeter. 

These neighborhoods are not by any means the only options, but they're a great place to start. 

Other agents or investors, would love to hear your opinions. Where have you found good house hacks?

Cartersville, Douglasville, McDonough, Stockbridge, Newnan and Covington come to mind. 

The biggest pro of cash flow is, in my opinion, lower risk. If you find a really good cash flowing property, it should cover the mortgage very easily, even with today's interest rates. You might not always MAKE money, but it's less likely you'll lose money. 

With an appreciation property, your rent income will barely cover the monthly expenses and mortgage. You might just break even in a good month. In a bad month, you might lose money. 

But of course, property appreciation is how you get REALLY wealthy in this game. If you buy a true cash flow property, it may be worth $250k today and $250k in 10 years. That's how it goes in a lot of these midwestern markets, for example. So you might get some great passive income to supplement or replace your W2, but you're probably not going to send your kids to private school with that kind of money. 

I would absolutely use a lawyer for an LLP.

I can't speak much to the benefits vs using legal zoom, but for any situation where you have different partners and are possibly raising money (common uses for LLPs, not sure your situation) you want to be absolutely sure everything is done right, as the risks are substantial with such things.

Some lenders do this. It's called "retrading" and some will retrade you literally up until the date of closing. It's most common with lenders that are planning to package and sell the loans to other banks/investors. If interest rates have moved in between your initial application and the date of closing, they will move their rate accordingly to make sure they're still getting a good deal. 

As to the legality, hard to say. It may be buried deep in the paperwork you initially signed that they're allowed to do this. 

A good way to avoid this is by working with a bank or any portfolio lender. Those lenders work on relationships and therefore are less likely to do this. Your terms may not be as good, but you'll have more peace of mind.

Hope that helps!

I highly recommend Atlanta. Prices are much lower than in many other places and the potential for appreciation is high. We are ALREADY facing a huge housing shortage here and the Metro population is expected to almost double in the next 20 years. 

Also great weather, great food and great sports! 

The Metro is enormous and sprawling, so the key is identifying which pockets best suit your investment criteria. Many of our clients are also transitioning to a rent-by-the-room model, which can increase cash flow dramatically. 

My brokerage and I work with a lot of out of state investors. Would be happy to answer any questions you may have, even if Atlanta isn't right for you. Please feel free to reach out

 Put differently:

Don't wait to buy real estate. Buy real estate and wait!

@Josh Milewski is pretty much spot on. His point about local PMs is good too. This may also help you find the PM you'll use for your investment, which is a great thing to do ahead of time. If you've found someone you like, they can help guide you to neighborhoods with good rental demand. 

Demand is all about how desirable of a place it is to live. Check things like the quality of nearby schools, local crime maps, quality of local retail, and quality of local jobs. If you can, walk/drive around the neighborhood and get a feel for it. Would you want to live there? 

Also check out Zillow for rent comps to see what the market is like. 

One thing I've learned: the question is not IF it'll rent, it's What will it rent for? Unless you're in a super owner-occupant dominant neighborhood, there will be SOME rent demand, it's just a matter of what people will pay.