North Atlanta Real Estate Market Update

North Atlanta Real Estate Market Update

Real Estate Broker · Johns Creek, GA · Member since 2009 · 870 posts · 664 votes

That Atlanta market peaked on July 2007 and bottomed in March of 2012. We have since made a complete "V" shaped recovery since March 2012. At this significant bottom, and retail real estate were trading at 1996 prices. Today we are at 2004 prices entering 2005 prices. YTD Atlanta real estate market is up 18.75%. If the last 12 month appreciation in Atlanta repeats itself in the next 12 months, homes in Atlanta will be trading at prices at the peak of the market before the crash in July of 2007.

I spend a lot of time studying demographic changes and Atlanta and Los Angeles are in a 15 year cycle. These two markets are very interesting to me becuase of this cycle. 2011 is 1996 and the demographics of 01/01/2014 of the north side of Atlanta will look much like the demographics of orange county, CA of 01/01/1999.

The north side of Atlanta is the new Orange County.

Irvine - Johns Creek
Alpharetta - Tustin
Milton - Coto de Caza
Suwanee - Foot Hill Ranch

In 1990, Irvine ethnic demographics looked like this:

white 68.8%, black 1.8%, Asian, 22.1%, hispanic 6.8% - 1990
white 61.1% black 1.4% Asian 29.8%, hispanic 7.4% - 2000

In 2010, Johns Creek's ethnic demographics looks like this:
white 63.45% black 8.8% Asian 23.36%, hispanic: 5%

In 2013, 30% of Johns Creek is now made up of Asian households

Johns Creek's Asian population grew from 13% to 23% within 3 years period of time.

All of Johns Creek High Schools are among the best of Georgia:
Northview, JC High, and Chattahoochee

All of Irvine High Schools are among the best of California:
Uni high, Northwood, Woodbridge, and Irvine High

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Investor · Atlanta, GA · Member since 2013 · 3k+ posts · 3k+ votes
12y

@James Park

I do assume that all your figures are again based on those sub-suburbs and not really on Atlanta?

I apologize, I'm not trying to attack you. I'm German and very straight forward and I'm not very good at being subtle ;-).

It's just that someone reading this in another state, they will think that your numbers pertain to Atlanta - and they do not. The northern far out suburbs are completely different from the Atlanta market. And they've also gone through different cycles. For example, Atlanta had a major slump in '99-'02, due to overbuilding for the Olympics. Even thought he Olympics were in '96, there were many condo projects on the books that came to fruition after '96.

Your area OTP is money and soccer moms and families. Whereas ITP has many different neighborhoods that each have their own values and cycles. Some have become hip and cool in the past few years (Midtown). Some have lost their hipness (Buckhead). You have a good number of revitalizations (Kirkwood, Cabbagetown, Reynoldstown, Edgewood, East Lake etc) and some that have stayed lower income neighbohoods. Many of the revitalized areas are singles or couples, straight or gay.

So, to be honest, it sort of bothers me, if you call your area 'Atlanta' , when it is really more suburbs of Atlanta suburbs. People from the suburbs tend to want to claim 'Atlanta' when it's convenient, but want to have nothing to do with us otherwise.

See this reply in the discussion

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  • Wholesaler · Campbell, CA · Member since 2014 · 187 posts · 70 votes
    11y

    Very interesting @James Park. Looks like a good time to enter the market.

  • Real Estate Broker · Johns Creek, GA · Member since 2009 · 870 posts · 664 votes
    11y

    @Assaf Furman,

    My guess is that we are probably at the half way point on this appreciation cycle. I really do believe that we will surpass the 2007 peak levels like Dallas, Denver, and the Bay area market has done unless the population growth into Atlanta metro market suddenly comes to a halt or suddenly all the national builders flood the market with inventory which reaches above the 140k level. One trend I am seeing is that the smaller mom and pop private builders are being bought out my national builders. One example of this is JEH homes was recent acquired by Taylor Morrision, a major builder in Southern California. 

  • Investor · Suwanee, GA · Member since 2014 · 38 posts · 15 votes
    11y
    I had the same estimation of appreciation in Gwinnett county due to the bump in new subdivisions started in the last 6 months. The builders are moving forward on projects, some that were on the shelf for 3 years. The value is at least at a point that builders feel they can confidently build the units and get the units sold while making a double digit percent in return.

    Originally posted 

    @Assaf Furman,

    My guess is that we are probably at the half way point on this appreciation cycle. I really do believe that we will surpass the 2007 peak levels like Dallas, Denver, and the Bay area market has done unless the population growth into Atlanta metro market suddenly comes to a halt or suddenly all the national builders flood the market with inventory which reaches above the 140k level. One trend I am seeing is that the smaller mom and pop private builders are being bought out my national builders. One example of this is JEH homes was recent acquired by Taylor Morrision, a major builder in Southern California. 

  • Realtor · Atlanta, GA · Member since 2015 · 693 posts · 357 votes
    11y

    Yeah the supply in Atlanta is so limited it's crazy, and appreciation of 43% since the end of 2011.... it's unreal

  • Real Estate Broker · Johns Creek, GA · Member since 2009 · 870 posts · 664 votes
    11y

    Vincent Crane

    Since the Atlanta housing market hit rock bottom on March 2012, we are back up 51.27% from the bottom and 8.5% below the last peak in July 2007 as of June 2015. We are already back to 2007 prices in the North Fulton and South Forsyth. My forecast for 165 index will be reached with the assumption that the inventory continues to be tight like it is today and the population growth is as strong as it is today. However, if the population growth suddenly slows or reverses or the big national builders suddenly floods the Atlanta market with inventory that reaches 140k +, my curve forecast will start to flatten and will start to correct. I see no sign of this near term.

    I have always believed that the Atlanta's median home price will eventually double from the March 2012 bottom. Only time will tell how accurate my forecast is.

  • Real Estate Broker · Johns Creek, GA · Member since 2009 · 870 posts · 664 votes
    11y

    Case Shiller data is updated. As of June 30th, 2015, both Atlanta and Los Angeles metro markets have appreciated 5.08%.

    Below is a chart for Peak to Trough Values for Atlanta, Chicago, Los Angeles, and San Francisco.

  • Real Estate Broker · Johns Creek, GA · Member since 2009 · 870 posts · 664 votes
    11y

    Now we can see some historical data as a buy and hold investor in Gwinnett vs Forsyth County. Gwinnett's housing peaked in August 2007 where the median sales price hit $200k. Prices dropped 52.5% down to $94,950 in January 2012. If you were one of those investors who bought back then and held on for three years, your property value would have more than doubled today. Data and Chart of Gwinnett County is Shown below.

    Gwinnett County Median Home Price Data



    Gwinnett County Medan Home Price Chart

  • Real Estate Broker · Johns Creek, GA · Member since 2009 · 870 posts · 664 votes
    11y

    When we see the data and chart for Forsyth County, the numbers are very interesting. Forsyth is a more affluent County than Gwinnett where the per capital income is higher and schools are rated mostly in the 9s and 10s. We can see that the peak median home price value took place on May 2007 at $295,000 in Forsyth County. Unlike Gwinnett County which corrected more than 50% from 2007 - 2012, Forsyth County only corrected 35.6%. If you had bought in Forsyth County at the bottom in Feb 2011, today your property value would have appreciated 59% vs 100+% had you bought in Gwinnett County. Gwinnett County's median home price is current at the peak level of 2007 whereas Forsyth County's median home prices are starting to make new highs surpassing the 2007 peak price level before the crash.

    Forsyth County Median Home Price Data

    Forsyth County Median Home Price Chart

  • Atlanta, GA · Member since 2015 · 32 posts · 6 votes
    10y

    Great post. Thanks, James!

  • Real Estate Broker · Johns Creek, GA · Member since 2009 · 870 posts · 664 votes
    10y

    Forsyth County has already set a new high. Looking at the seasonal trends median home prices start to bottom in November - February and starts its strong upward movement in March. 

    As of August 2015, the case shiller index stands at 126.09, which is still 7.6% below the last peak in July 2016. Between Jan 2015 - August 2015, Atlanta home prices have appreciated 6.1%.

  • Investor · Marietta, GA · Member since 2015 · 382 posts · 258 votes
    10y

    @jamespark. James do the numbers support strong population growth with reasonably low SFH supply in Kennesaw?

  • Real Estate Broker · Johns Creek, GA · Member since 2009 · 870 posts · 664 votes
    10y

    In 2014, housing prices in the metro Atlanta region rose 5.2% and in 2015, housing prices have rose 6.1%. I think we are going to continue to see a stable appreciation between 5-6% in the Atlanta metro market in the years ahead. 2012 - 2013 was a very unique period where home prices in metro Atlanta rose more than 30% within the 24 month period between January 1, 2012 - December 31st, 2013.  

    AtlantaMetro Home Prices:
    YearAppreciation/Depreciation


    1991 0.6%
    1992 2.1%
    1993 4.5%
    1994 4.6%
    1995 3.2%
    1996 3.5%
    1997 4.6%
    1998 6.7%
    1999 7.2%
    2000 6.6%
    2001 4.3%
    2002 3.1%
    2003 3.5%
    2004 4.4%
    2005 5.5%
    2006 2.2%
    2007 -4.3%
    2008-14.3%
    2009 -2.2%
    2010 -6.3%
    2011-14.8%
    2012 13.5%
    2013 18.5%
    2014 5.2%
    2015 6.1%

  • Real Estate Broker · Johns Creek, GA · Member since 2009 · 870 posts · 664 votes
    10y

    Between 01/01/2015 - 12/31/2015, the Atlanta metro market has appreciated 5.8%. We are currently still below the July 2007 peak by 7.8%. Housing starts are growing since 2009 but still at levels below 1990, which leads me to believe that more appreciation is ahead in the Atlanta metro market. Inventory levels in metro Altanta are currently around 41k.



    Comparison of Case Shiller Atlanta index vs Unemployment.

  • Real Estate Broker · Johns Creek, GA · Member since 2009 · 870 posts · 664 votes
    10y

    Below is the MSA City performance. Atlanta metro's performance currently ranks #8 behind Denver, Dallas, Portland, Boston, San Francisco, Charlotte, and Seattle.


    Comparision Data : Case shiller index for Atlanta, Los Angeles, and S&P500

  • Residential Real Estate Broker · Atlanta, GA · Member since 2012 · 34 posts · 9 votes
    10y

    Thanks James, good stuff. 

  • Real Estate Broker · Johns Creek, GA · Member since 2009 · 870 posts · 664 votes
    10y

    Below is a chart of what inventory looks like in Metro Atlanta. We hit a low on January 2nd, 2013 and recently on January 5th, 2016 we hit another low.

    For all of you buy and hold investors in metro Atlanta, this is NOT the time unload.

  • Investor · Suwanee, GA · Member since 2015 · 127 posts · 34 votes
    10y

    Thanks @James Park.  I appreciate you sharing this info!

  • Real Estate Broker · Johns Creek, GA · Member since 2009 · 870 posts · 664 votes
    10y

    This is what the immigration map looks like in Atlanta. It looks like a work of Art.



    Just for comparison, this is what the immigration map looks like Los Angeles, California.

  • Real Estate Broker · Johns Creek, GA · Member since 2009 · 870 posts · 664 votes
    10y
  • Real Estate Broker · Johns Creek, GA · Member since 2009 · 870 posts · 664 votes
    10y

    Current Inventory Levels in Forsyth and Gwinnett County

  • Real Estate Broker · Johns Creek, GA · Member since 2009 · 870 posts · 664 votes
    10y


    Forsyth County is the fastest growing County in the state of Georgia and 11th fastest growing county in the United States.

    FORSYTH COUNTY — Anyone living in or passing through Forsyth, especially the south end, could guess this — new census figures show the county is one of the fastest growing in the nation. Again.

    According to annual figures released this month by the U.S. Census Bureau, Forsyth County experienced the 11th highest percent change in population growth from 2014 to ’15, which marks the highest in Georgia.

    Population estimates as of July 1, 2014, were 203,882 and had risen to 212,438 as of July 1, 2015.

    This 4.2 percent change tied with Morgan County, Utah, and Kendall County, Texas, though they have about 11,000 and 40,000 residents, respectively.

    Forsyth also ranked 11th in the country for population growth over the past five years, representing a 21 percent increase from 175,511 people in 2010.

    The rise from 2010 has accelerated in the past few years, with Forsyth coming in at No. 18 in 2013 and at No. 12 in 2014.

    Fast-paced, sustained growth does not surprise local officials, especially in the school system, an area that sees the effects every day.

    Forsyth County Schools has experienced enrollment surges since the late ’90s, including throughout the recession, according to Jennifer Caracciolo, spokeswoman for the district.

    Challenges that come with such increases include hiring and retaining high-quality staff, “accommodating the growth from a financial aspect and planning for capital improvements.”

    “Our voters have generously approved bond and SPLOST referendums to provide these much needed resources,” Caracciolo said. “The first large-sale phase of our 2014 bond projects, which includes improvements at existing schools and opening two new schools, will be complete this summer.”

    Brandywine Elementary and DeSana Middle, both in southwest Forsyth, are set to open in August.

    As per state law, new schools cannot be funded and built until a district can prove existing schools are crowded. In Forsyth, that has meant new schools often are near capacity by the time they welcome their first students.

    “Next school year, we will complete second-phase projects at existing schools, and in 2018, [we will] open Denmark High School and the Alliance Academy for Innovation,” Caracciolo said.

    “We are also expanding non-traditional offerings that won’t strain our facilities’ needs, such as online, hybrid, dual enrollment and flexible scheduling options.”

    She said the community, as a whole, values and supports education, helping to retain the district as one of the top-performing in the state and nation in the face of growth.

    The fastest growing county in the U.S. from 2014 to ’15 was McKenzie County, N.D., which grew 16.7 percent to a population of 12,826.

    Forsyth’s population total is smaller than only one county growing faster: Fort Bend, Texas, which grew 4.3 percent to reach an estimated 716,087 people.

    Other Georgia counties that ranked in the top 100 include: Bryan County at 22nd (3.6 percent); Columbia County at 28th (3.4 percent); Long County at 39th (3.2 percent); Effingham County at 51st (3 percent); Barrow County at 53rd (3 percent); Clarke County at 80th (2.6 percent); Fannin County at 93rd (2.5 percent); and Jackson County at 96th (2.4 percent).

    All population estimates are for counties with 10,000 or more people.

    Source: http://www.forsythnews.com/section/2/article/29791...

  • Suwanee, GA · Member since 2016 · 7 posts · 3 votes
    10y

    I've noticed new for sale signs all down Old Atlanta every time I head off to work. The prices are appreciating like crazy and I guess everyone is trying to get their bite.

  • Alpharetta, GA · Member since 2016 · 44 posts · 5 votes
    10y

    @James Park, this information is so valuable!  I'm just moving from Buffalo to Alpharetta and can confirm from a primary residence perspective that I am seeing this appreciation first hand as I'm buying my new home.  Based on the area I'm moving into, I can see the massive amounts of homes being built in order to take advantage of the lower inventory.

    I know that you've done a ton of work to create this data.  To date I have simply relied on Zillow, Trulia, Citi-data, deptofnumbers.com, bestplaces.net and a few other types of sites to attempt to understand the market numbers.  For a new investor, do you have any other recommendations for where to look to find more of this data type of data for other areas?

  • Real Estate Broker · Johns Creek, GA · Member since 2009 · 870 posts · 664 votes
    10y

    Below is full list of the highest Price to Rent city vs the lowest Price to Rent city.

    Druid Hills in DeKalb county has the lowest CAP rate vs Forest Park, GA in Clayton County has the highest CAP rate.



    Below is the data of Atlanta metro counties with the lowest Cap Rate : Forsyth County vs the highest Cap Rate : Henry County (Price to Rent ratio: 10.2, Paulding County (Price to Rent ratio: 10.36, Clayton County (Price to Rent ratio: 8.01, Haralson County (Price to Rent ratio: 8.56.

  • Real Estate Broker · Johns Creek, GA · Member since 2009 · 870 posts · 664 votes
    10y

    Below are the inventory level charts of the following counties in metro Atlanta:

    Oconee (next to UGA campus), Fayette (Peachtree City), Paulding (higher cap rate), Henry (higher cap rate), Clayton ( higher cap rate), Fulton, Gwinnett, and Forsyth. 

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