Real estate investing can be a lucrative way to build wealth and achieve financial freedom. However, it’s important to approach real estate investing with caution and do your due diligence before making any investments. In this blog, we’ll explore what real estate investors need to know about three popular investment options in Atlanta: student housing, short-term rentals, and commercial properties for sale.
Student Housing: A Growing Market
Student housing is a growing market in Atlanta. With several colleges and universities in the area, there is a high demand for affordable, convenient housing options for students. Investing in student housing can be a profitable venture, but it’s important to understand the unique challenges and considerations that come with this type of investment. Student housing as an investment vehicle has become very popular in the last 10 years, as more and more Americans are choosing to go to a college or university after graduating high school. This sector of real estate investing is set to grow and expand and presents a great opportunity for investors to take advantage of this asset class.
One of the biggest challenges with student housing is tenant turnover. Students typically only stay in one place for a year or two before moving on to the next stage of their education. This means that landlords must constantly find new tenants to fill their properties. However, this can also be an advantage, as it allows landlords to adjust rental rates and keep up with market demand. With higher turnover, a landlord is able to increase the rental rate sometimes semester by semester. Another important point to consider is the tenant screening process when it comes to college students. Most students do not have a job while in school, or they are only working part time. It is important to get the student’s parent to cosign on the lease if they do not have the income qualify. This will be a common occurrence, and should not be of concern, just something to look out for.
Another consideration with student housing is the need for proximity to campus. Students want to be close to their classes and other campus activities, so properties that are within walking distance or a short commute are more desirable. Additionally, properties with amenities that appeal to students, such as study spaces, fitness centers, and game rooms, may command higher rental rates.
When investing in student housing, it’s important to work with a real estate agent who has experience in this market. They can help you identify properties that are in high demand and provide valuable insights into the local rental market. A good real estate agent that is familiar with student housing will be a great resource when it comes to finding good tenants and marketing the property effectively.
When pricing student housing, it is important to look at the rental rates if the surrounding housing around the campus. If the rates for a student housing apartment unit are $1200, then you should be pricing your unit at a similar rate. Student housing rates will not be the same as a regular comp in the area that targets families or non-students.
Short-Term Rentals: A Booming Industry
Short-term rentals, such as those available on Airbnb and other vacation rental platforms, are a booming industry in Atlanta. With the city’s popularity as a tourist destination, there is a high demand for short-term accommodations. However, there are also a number of regulations and considerations to keep in mind when investing in this type of property. Before investing in the short term rental asset class, it is very important to understand the risks and overhead associated with this type of investment.
One of the biggest challenges with short-term rentals is the need for consistent occupancy. Unlike long-term rentals, which typically have tenants in place for months or years, short-term rentals rely on a constant stream of guests. This means that landlords must have a solid marketing plan in place to attract guests and keep their properties occupied.
Another consideration with short-term rentals is the need to comply with local regulations. In many cities, there are restrictions on the use of residential properties for short-term rentals. Some cities require permits or licenses, while others have strict zoning laws that prohibit short-term rentals in certain areas. It’s important to research local regulations and ensure that your property is in compliance before investing in a short-term rental.
When investing in short-term rentals, it’s important to consider the location and amenities of the property. Properties that are in popular tourist areas and offer unique amenities, such as a pool or outdoor space, may command higher rental rates. Additionally, properties that are well-maintained and offer a high level of customer service may receive better reviews and attract more guests.
Commercial Properties for Sale: A Diverse Market
Commercial properties for sale in Atlanta offer a diverse range of investment opportunities. From office and retail spaces to industrial properties and warehouses, there are many different types of commercial properties to choose from. However, investing in commercial real estate requires a different approach than residential real estate.
One of the biggest differences between commercial and residential real estate is the leasing process. Commercial leases are typically longer and more complex than residential leases, and landlords must have a solid understanding of the terms and conditions of the lease before investing in a property. Additionally, commercial leases often include provisions for rent increases and tenant improvements, which can impact the landlord’s bottom line.
Another consideration with commercial properties is the need for maintenance and repairs. Commercial properties often require more maintenance than residential properties, and landlords must have a solid plan in place for keeping their properties in good condition. Additionally, landlords must be prepared to handle any tenant issues that arise, such as disputes over rent payments or property damage.
When investing in commercial properties for sale, it’s important to consider the location and potential for growth. Properties that are in high-traffic areas and offer convenient access to transportation and other amenities may command higher rental rates. Additionally, properties that are located in areas with strong job growth and economic development may offer better long-term investment potential.
Investing in real estate can be a great way to build wealth and achieve financial freedom. However, it’s important to approach real estate investing with caution and do your due diligence before making any investments. Whether you’re interested in student housing, short-term rentals, or commercial properties for sale, it’s important to work with professionals, such as the team at Nance Homebuyer, who has experience in your chosen market. We can provide valuable insights and help you make informed investment decisions that align with your overall financial goals. Reach out to us today to learn more! 770.746.8608