Atlanta House Hacking Near the State Penitentiary

[Prachel C.]

My husband and I are thinking about getting a duplex, or a single family home with basement near the State Penitentiary, in 30315 / 30316. 

We've looked at Pittsburgh, South Atlanta, Lakewood and Lakewood Heights. From driving around, there are a lot of boarded up homes, but in actuality, there only seems to be a handful of listings on the MLS. Our agent told us that for every house, there's about 5 potential buyers because of the market.

Ideally, we'd like to renovate - just enough to live there and get a tenant in the other unit (or the basement apartment). We want to be a part of the community, so South Atlanta is attractive because there is a local meeting spot, a coffee shop. 

The question is - in Atlanta, people don't seem to mind living next to cemeteries, but just for investment purposes, what about living next to a prison?

Our agent has advised that we stay away from the penn, but, I don't know. I'm just looking for sound advice on whether or not we should be avoiding the areas right next to the penn. 

[David Faulkner]

Originally posted by @Account Closed:

I think you should look at who would want to live there.  A prison employs a lot of people.  And they need somewhere to live.  And, living close to where they work would be attractive to a lot of people.

So, I think you have a market.  You need to figure out if renting to that market will make you a profit on that particular property.

But, if you can offer a decent place to live, at a good price to people who work at the prison - I think you could do very well.

I recently lived in a town with a prison within the town limits.  The housing for families who move to that area to work at that prison is a really tight market.  

If I was you, I'd talk to some people at the prison.  Ask them who might want to rent your units, ask them if they have a place you can advertise your units, etc.

This is what I did when I realized I liked renting to law students.  I managed a building next to a university, but we hated undergrads.  So, I went to the law school and talked to them about how I could advertise to their law students.  Turned out, they didn't have enough housing for incoming law students and were thrilled to advertise my vacancies on their law school facebook page.  I ended up with a waiting list.

Prisons employ lots of people of every wage level.  Could be a gold mine.  Just depends on your costs and what you can get in rents on whether or not you can make a profit.  But, the market is there - if the price is right for them.  Sounds like the location is ideal :-)

I like this line of thinking ... this is how I would approach it too ... along the same lines, perhaps there is a market for short term or even long term for loved ones of those in prison who don't live near but would visit from time to time ... that could be a regular client base for you too.

5 interested parties for every property does not jive well intuitively with boarded up houses everywhere, BTW ... I'd double check that statement with some independent verification to make sure the realtor is not just blowing smoke. Be sure you fully understand all of the risks and long term implications of investing in neighborhoods like you describe also ... I'd go to a local REIA and talk it over with some local investors to get their take on the area and strategies.