Buying in Atlanta

[engelo10]

Nice net yield.

Well done Engelo

Hi Chindonly,

Thanks much appreciated.

I would consider the area a bit higher risk than what the other guys in previous posts are buying in Atlanta but the numbers definitely work.

Being on the ground also I have the privilege to be patient and wait for the best deal to come along before I buy. Snagging a cheapy and bettering the numbers even more.

Have a great day.

 

[MTR]

Hi All
For those with US property, just an update on Atlanta.

Property prices continue to rise, spoke to Karina from Select American Homes and she said that they are jumping up another level as everything is selling with multiple offers, still huge demand from everywhere, US home owner occupiers are back in the market.

I think we will see some more serious growth. We were purchasing properties around 75% below market value some 2 years ago, prices are still not back to 2007 prices, but getting up there.

Cheers
MTR

 

[starter]

Kudos Marrisa. I looked seriously at the US in 2011 and it was very attractive but the lack of being able to gear put me off as we're still in the accumulation phase, not surprised to hear that it's doing well though.

 

[Oscar]

great news MTR. Apart from the growth it's great to also see those rental returns every month.

I had a coffee with Karina over xmas/new year for a good catch up on all things Atlanta. I wish I had invested more a couple years ago.

 

[MTR]

great news MTR. Apart from the growth it's great to also see those rental returns every month.

I had a coffee with Karina over xmas/new year for a good catch up on all things Atlanta. I wish I had invested more a couple years ago.

Hi Oscar
She is flat out buying for clients, still huge demand and she feels there will be much more growth over the next 3 years. I think this also be the case. Yes, I stopped buying as prices shot up too quickly.

I saw one of your properties ... I think Logan?? Very nice.

Things are improving on the rental side, shame about the banks and IRS, spent 2 hours on the phone Monday evening, they have systems in place that don't work, let me slit my wrists.

I was kind of wondering with the way the US operates how they managed to go to the moon, seriously, these guys are still using faxes for everyday business.

I promise I will never complain about our banks in Australia etc.

 

[engelo10]

Hi Oscar
She is flat out buying for clients, still huge demand and she feels there will be much more growth over the next 3 years. I think this also be the case. Yes, I stopped buying as prices shot up too quickly.

I saw one of your properties ... I think Logan?? Very nice.

Things are improving on the rental side, shame about the banks and IRS, spent 2 hours on the phone Monday evening, they have systems in place that don't work, let me slit my wrists.

I was kind of wondering with the way the US operates how they managed to go to the moon, seriously, these guys are still using faxes for everyday business.

I promise I will never complain about our banks in Australia etc.

Hey guys,

There has been lots of growth here on the East and West coasts.

Not much movement in the Midwest.

Some amazing values being offered in Michigan, Ohio, Indianapolis, Missouri, Kansas.

Midwest is more of a cashflow play and I predict much slower growth.

I have been living in the US since September of 2012 and have finally wrapped my head around writing and receiving check (I still stuff up ever 2nd one lol) and doing an online transfer after which the bank cuts a check and mails it to the recipient.

YES, that's correct

You do an online transfer and the bank writes the check and mails it

WTF???

OZ banks are heaven lollol

Thanks for reading and have a great day.

 

[D.T.]

YES, that's correct

You do an online transfer and the bank writes the check and mails it

WTF???

OZ banks are heaven lollol

Thanks for reading and have a great day.

Third world countries have better systems.

 

[engelo10]

Third world countries have better systems.

Very true D.T.

Oh well its something one must put up with in order to steal all of the cheap properties

Thanks and have a great day

 

[impala67]

Hi All
For those with US property, just an update on Atlanta.

Property prices continue to rise, spoke to Karina from Select American Homes and she said that they are jumping up another level as everything is selling with multiple offers, still huge demand from everywhere, US home owner occupiers are back in the market.

I think we will see some more serious growth. We were purchasing properties around 75% below market value some 2 years ago, prices are still not back to 2007 prices, but getting up there.

Cheers
MTR

Sounds promising MTR...what's the next step? Or just business as usual. Buy.

 

[MTR]

Sounds promising MTR...what's the next step? Or just business as usual. Buy.

Next step, my initial investment $500,000 am expecting to bring back $1M but I think I will need to wait till the end of the year, would like Au$ to fall back, seems like it has bounced back. In the mean time just collect the rent as I am cash flow positive. For those buying now it would not be a cash flow play it will be purely growth, from what I am reading from the US property experts they are expecting 3 years of further growth.

US property is rising, so are some Oz markets and you can leverage in Oz, not the case in US.

Cheers
MTR

 

[engelo10]

Next step, my initial investment $500,000 am expecting to bring back $1M but I think I will need to wait till the end of the year, would like Au$ to fall back, seems like it has bounced back. In the mean time just collect the rent as I am cash flow positive. For those buying now it would not be a cash flow play it will be purely growth, from what I am reading from the US property experts they are expecting 3 years of further growth.

US property is rising, so are some Oz markets and you can leverage in Oz, not the case in US.

Cheers
MTR

I would very much also like the AUS to drop lollol

There has been quite a shift in the US recently. Looking forward to the next few years.

 

[Oscar]

Next step, my initial investment $500,000 am expecting to bring back $1M but I think I will need to wait till the end of the year, would like Au$ to fall back, seems like it has bounced back. In the mean time just collect the rent as I am cash flow positive. For those buying now it would not be a cash flow play it will be purely growth, from what I am reading from the US property experts they are expecting 3 years of further growth.

US property is rising, so are some Oz markets and you can leverage in Oz, not the case in US.

Cheers
MTR

Well done MTR - you looked afar, saw a window of opportunity, took a well managed risk, set yourself up, and now you're left with options. Put in 500 take out 1MM, I love it...

 

[MTR]

An update on Atlanta/USA property market

Hi All
Its been a while since I posted

Just thought I would give you a brief overview/update on what is currently happening in the Atlanta market.

Property prices are continuing to rise, there is still huge demand from foreign investors and it is getting easier now for home owners in US to source funds, so now we are seeing more home owner occupiers buying. There is currently a lack of supply which is what is driving the property market up.

My Australian BA has told me that it is getting more difficult to source properties and that she has many Australian buyers still continuing to purchase property in this market.

Rents in Atlanta still remain the same from the day I purchased and still providing good returns .

Property management services have improved immensely as we now have a new pm who has similar model to Australian pm system.

County taxes dropped significantly over the last 2 years, however now we are seeing property taxes rise as house prices continue to rise.

On average my property purchases varied from $32,000-50,000 US dollars.

The US market peaked at around 2007 and some of the prices of these homes that I purchased at this time had showed sales evidence at around $160-170K on average. The way the US market is going I expect they will go back to these prices, especially when new builds begin, which I am told is actually happening now.

These properties will now sell for anything over $110,000-130,000 US dollars.

Here is a link of one of my properties on Zillow, this is currently renting at I think around $1000 per month.

http://www.zillow.com/homedetails/210-Hazelhurst-Dr-Covington-GA-30016/69877018_zpid/


I still own 8 properties in Atlanta, however I did place this property below on the market last year and received an offer eventually of $127,000, within 1 week. I decided not to sell and pulled the pin on it and wait for the Au$ to fall back further. Capital gains tax in US is 15% and real estate selling fees are 6%, that one hurts.

I am also just considering not selling at all due to strong cash flow with gross yields at around 20%+

I purchased this one at $34,200 renting at $1150 per month

http://www.zillow.com/homedetails/6120-Course-Side-Way-Lithonia-GA-30058/61920414_zpid/

It would be great if we had some feedback from Karina

Cheers
MTR

 

[Mr. Fabulous]

Crikey MTR, you're killing it over there.

 

[MTR]

Crikey MTR, you're killing it over there.

Thanks Mr Fab

There are others.....Handyandy purchased many.
Oscar sourced properties from Karina and I think he just purchased another one a couple of months ago, She gets some great deals. We suffered initially trying to get the right set up etc. but I think its now paying off.

 

[oc1]

Crikey MTR, you're killing it over there.

She kills everything

 

[sanj]

Great work MTR! Should be some outstanding profits.

 

[MTR]

Thanks Sanj and oc1

I can tell you as Blacky has said..... "its not all been beer and skittles".

I had 4 vacancies in the first year, where tenants trashed my properties, I felt like throwing in the towel and selling the lot.

Its taken time to understand and source the right property management company, insurance company, US tax accountant.


Cheers
Marisa

 

[redwing]

Great work

Good to read the update

Fortune Favours The Brave

 

[karina]

MTR I am really pleased with our change in property management. Over the years one of the biggest pieces of feedback I had been getting from people is that they wanted property management to run more like it does in Australia.

US property managers tend to make lots of decisions without consulting owners, everything from accepting new tenants to renewing leases.

I have wanted to introduce property management that engages with clients and gives them some say in the decision making process on tenants placed in their homes, duration of lease renewals and pricing etc. I am happy to say we have now moved to a new model that allows us to do this.

The biggest area of concern has always been repairs. Property management companies in the US seem to make a nice revenue stream from the misfortune of owners by making money on organising repairs through placing some sort of mark up on the repair with many charging as much as 20% mark up. They also tend to view the management fee as a "rent collection fee" and want to charge for everything in addition such as inspections, connecting utilities, move outs, repair mark up etc etc.

We have moved away from this business model and have a manager on board that manages our properties the way we are used to in AUS that is charges an all inclusive managament fee and organises repairs without charging any mark ups with full transparency of all invoices.

This model is working really well for us and I can see this will improve our cashflow.

As for the Atlanta market its been nothing short of spectacular. Properties purchased in 2011/2012 have made some nice gains however I am still picking up deals at hugely discounted prices based on the prices achieved in the peak of the market. Properties are still available at 30 - 50% below peak prices and replacement cost.)

Net returns have obviously fallen since the low of the market in 2011/2012. We are now looking at 8 - 10% net for good properties in Atlanta. By net I am referring to net of fixed yearly costs such as insurance, property management , strata fees (known as HOA fees) and council rates (known as county taxes). I am still personally buying and try to buy a property whenever I have funds.

This is one of my most recent acquisitions in Covington GA. (purchased for $73.500) + renovations of 7.5k

https://www.youtube.com/watch?v=Ql4xUdYYtVQ&feature=youtu.be

Although there are some great deals still available the supply is diminishing. I am hopeful that we may have another 12 + months in the 100k and under price range but the market can move quite quickly.

Like every great buying opportunity there is a limited window of time before the market moves on. The US housing market is in recovery, confidence is returning and prices are now increasing. I will be working hard over the next year or 2 to maximise what is left of this opportunity.

If anyone is having issues with Atlanta property management feel free to PM me. Although the property management service is exclusive to our clients at this time I would be happy to help any forum members that maybe struggling in this area.