All Forum Posts by: James Park

Interesting article of the domestic migration trends in 2018 with charts.

As mortgage rates climb, affordability in the most expensive markets has suffered, driving more people to affordable, low-tax inland job centers in states like Florida, Texas and Tennessee.

In the third quarter of 2018 people continued to move away from high-cost coastal markets like , , and , in increasing numbers. Meanwhile, more affordable areas like , and continued to draw thousands of potential new residents. The latest migration analysis is based on a sample of more than 1 million Redfin.com users who searched for homes across 80 metro areas from July through September.

Nationally, 25 percent of Redfin.com home searchers looked to move to another metro area in the third quarter, compared to 22 percent during the same period last year. Affordability continues to be a driving factor causing people to move away from the coasts.

“Rising mortgage rates are exacerbating affordability issues that have been driving people out of expensive coastal metros for the past few years,” said Redfin chief economist Daryl Fairweather. “With rates no longer near historic lows, buyers are increasingly cost-conscious, in the South and middle of the country.”

Moving Out – Metros with the Highest Net Outflow of Redfin Users

San Francisco, New York, Los Angeles, Washington, D.C. and posted the highest net outflows in the third quarter. Net outflow is defined as the number of people looking to leave the metro minus the number of people looking to move to the metro. A net outflow means there are more people looking to leave than people looking to move in, while a net inflow means more people are looking to move in than leave.

Source: https://www.redfin.com/blog/2018/10/q3-2018-migration-report.html?fbclid=IwAR0DprtRk444obNLsdcgDrXPk5FhGYhY95tnRkvWB_7aD8ymZixJ2VCvarA

Right out of college, I worked as a consultant with Accenture and rented an apartment in West LA. I bumped into the owner on day and asked him if he can give me some advice on how I can get started in real estate investing. I took him out for breakfast in a nearby restaurant and this is the advice he gave me. 

"Real estate fortunes are made by buying houses and by the  financing them so that you can afford to hold the house until it is free and clear of debt. He also told me borrow for the longest available term as a lower payment is a safer loan for you to owe. The key of having peace of mind and sleeping well at night while you are in debt is knowing that can repay the debt. When you buy income properties, your tenants will repay your debt if you buy and finance wisely.

The surest way to become a millionaire with real estate is to borrow a million dollars, buy property, and then pay it off. Even if the properties never appreciates, you would have your million dollars. If you learn how to borrow that million dollars safely so you can sleep well, then you are on your way to unlimited financial success. The safety comes from borrowing against property that generates enough income to repay the loan."   

Atlanta declared third fastest-growing metro area in the nation, after Dallas Fort Worth and Houston 

The statistics, published by the U.S. Census Bureau, mean Atlanta saw the third highest population gain of any metro in the country, behind Dallas and Houston respectively—cities with larger overall populations. The numbers put Atlanta’s growth well ahead of Washington, D.C., which has a larger overall population than Atlanta, too. For now.

Between 2016 and 2017, metro Atlanta packed on nearly 90,000 new residents, bringing the total population in the region to an estimated 5,884,736 people.

If it feels like Atlanta is getting more crowded and it is.

#1 Dallas, #2 Houston, #3 Atlanta

Atlanta declared third fastest-growing metro area in the nation.

If it feels like Atlanta is getting more crowded, it is.
Between 2016 and 2017, metro Atlanta packed on nearly 90,000 new residents, bringing the total population in the region to an estimated 5,884,736 people.

The statistics, published by the U.S. Census Bureau, mean Atlanta saw the third highest population gain of any metro in the country, behind Dallas and Houston respectively—cities with larger overall populations. The numbers put Atlanta’s growth well ahead of Washington, D.C., which has a larger overall population than Atlanta, too. For now.

https://www.youtube.com/watch?v=zYDrR3G8J4U

Video of skyline of Buckhead. Buckhead is an affluent uptown commercial and residential district of Atlanta, Georgia, comprising approximately the northernmost fifth of the city.

Where To Invest In Housing In 2018 : Atlanta Rank #7 according to Forbes

1. Orlando, Fla.

Average home price: $247,550
3-year population growth: 7.6%
2-year job growth: 7.1%
1-year home price growth: 9%
3-year price growth forecast: 35%

2. Provo-Orem, Utah

Average home price: $266,169
3-year population growth: 7.2%
2-year job growth: 6.7%
1-year home price growth: 10%
3-year price growth forecast: 31%

3. Jacksonville, Fla.

Average home price: $247,809
3-year population growth: 5.9%
2-year job growth: 6.1%
1-year home price growth: 8%
3-year price growth forecast: 20%

4. Raleigh-Durham, N.C.

Average home price: $274,980
3-year population growth: 4.9%
2-year job growth: 5.8%
1-year home price growth: 8%
3-year price growth forecast: 26%
Homes are undervalued by 3% compared to the historic ratio of price and local income.

5. Ogden-Clearfield, Utah
Average home price: $246,251
3-year population growth: 5.1%
2-year job growth: 5.7%
1-year home price growth: 10%
3-year price growth forecast: 29%

6. Nashville-Davidson-Murfreesboro, Tenn.
Average home price: $277,842
3-year population growth: 6.1%
2-year job growth: 5.5%
1-year home price growth: 10%
3-year price growth forecast: 27%

7. Atlanta-Sandy Springs-Marietta, Ga.

Average home price: $234,249
3-year population growth: 4.9%
2-year job growth: 5.1%
1-year home price growth: 8%
3-year price growth forecast: 24%
Homes are undervalued by 7% compared to the historic ratio of price and local income.

Source:

https://www.forbes.com/sites/samanthasharf/2018/02...

I put together the MSA comparison for each major MSA markets for real estate and Nashville, TN was an interesting data point. The housing market in Nashville is 40% of above its last peak of Jan 2008.

For the local investors there, Just curious to what is going on over there? When all the other real estate markets were dropping 25-50% during the last mortgage crisis between 2006-2011, Nashville market just dropped 9.1%. Tech jobs? Population Growth, Low Taxes? Nashville's housing market looks to be 9.1% to the downside and 40% to the upside. In Atlanta, we dropped almost 40% in the last downturn and now 4.9% above the last peak in July 2007. What is going on in the housing market in Nashville?

@Account Closed, Thank you.  

It appears that the Atlanta market is keeping pace with the overall national housing marketing: Comp 10 and 20. I will try to update more often.

Year over Year from March 2017 - March 2018, the Atlanta housing index appreciated 6.2% which is about the national average. The Atlanta market is now 4.9% above the last peak of July 2007. The Los Angeles housing index appreciated 8.1%, but still lags behind Atlanta from peak to current declines at 2.3%. The top performing housing market is Nashville, TN with an appreciation of 8.8% year over year and 40% above the last peak date of Jan 2008. Below are the chart comparisons between the Atlanta and Los Angeles Index.

The largest increase in housing costs would be in Raleigh, which wouldn't be able to build enough homes to sustain the influx of workers, according to the report. Meanwhile, housing costs would stay lower in places like Dallas, which has lax building restrictions and a cheaper labor pool.
Apartment List said Raleigh, Pittsburgh and San Jose would experience the highest rent increases if HQ2 comes to town. The impact would be smaller in cities like Washington D.C., Los Angeles and Dallas.

"Rents are already rising rapidly nationwide," Apartment List said in a report that analyzed data from the U.S. Census and Bureau of Labor Statistics. Half of renters are considered "cost burdened," spending 30 percent or more of their income on rent, according to the firm.

New research from Apartment List, a site that catalogs apartment rentals across the country, forecasts an annual rent increase of up to 2% per year in the city that houses HQ2. That's on top of organic price increases that already occur from year to year.



At the same time, the city that scores the second headquarters can expect housing prices, along with other costs of living, to increase.

Home prices are set to soar in 2018.

Take a look at the Dallas and Nashville chart. Nashville's housing prices are now 35% above the last peak while Atlanta is just getting back up to his last peak of July 2017. I sense that the Atlanta's housing market momentum is starting to build just like the LA/OC market between 1994 - 1999. There is no reason why Atlanta housing market can't be above 35% the last July 2007 peak like Nashville. Amazon's second headquarters in Atlanta will be a complete game changer.