Canary in A Coal Mine?
Nothing is definite as of yet, but recent trends suggest that investor owners in our area are experiencing a time of belt-tightening.
In September, we had to voluntarily terminate the leases of two tenants who couldn’t pay their rent (a much cheaper and less time-consuming process than eviction). In October, over 10% of our tenants paid late. Zillow reports that our rental market is cooling and that even though rents increased through the summer of 2025, they have started to decline since then.
Why?
Atlanta’s rent prices have seen one of the biggest drops among major U.S. cities, falling 13.6% from their peak in October 2021 to a current median of $1,572.
- Drop:6% from its peak in October 2021.
- Current Median Rent:$1,572.
- Peak Median Rent:$1,820 in October 2021.
Reasons for the Rent Drop
- Slowing Migration: The trend of people moving into the Atlanta area has slowed down.
- Increased Housing Supply: There has been a substantial increase in the number of new multifamily units available for rent, providing more choices for renters.
- Economic Factors: Slower migration and increased supply create a more balanced market, putting downward pressure on prices.
In addition, many of our investor owners bought new homes 4 to 8 years ago and must also plan for re-painting, new appliances, flooring, and roofs. The costs of all of these items have risen significantly. These owners saw significant appreciation since 2020, but the projected appreciation of home prices has slowed to about 2.5% to 4% for the next few years.
Our suggestion – sell your older home and 1031 Exchange into newer properties, or pay the taxes and cash out.
Any questions? – give us a call at 770- 726-1256
That Being Said, we came across an interesting option to buy! Brand new homes within 3 miles of our office. Nicely built and appointed. $500,000 to $540,000 (4 or 4 Bedroom, 2 car garages, pool and clubhouse, small yards, gated entrances). But they are offering 4.75% 30-year financing with either a finishing package (Washer dryer, blinds, refrigerator, etc) or a 2:1 buydown, which means for the first year the interest rate is 2.75% (2nd year 3.75%). Which means your principal and interest payment for year one could be (with 20% down) only $1633 per month – I’d need to research the taxes, insurance, and HOA fees – but it would certainly rent for $2200 to $2500 a month. This is the least expensive new development I’ve seen in the area for years.
