In SFR investing, market selection is the process of choosing a specific market to invest in. This is an important decision as market-specific dynamics can significantly impact the performance of your real estate investments. Ascend's market-selection is usually the first question we are asked by our own real estate investors.
When we started Ascend, we analyzed over 50 metros across the US, comparing them using a multitude of factors including demographics, housing supply, job market etc. One of the first markets to stand out during this analysis was Atlanta, GA. With over 240 neighborhoods, Atlanta has something for everyone. The city is full of rich cultural history and provides access to beautiful parks and green spaces. Additionally, it has some of the best healthcare in the country. The incredible food scene doesn't hurt either.
In this blog post, we're going to share with you some of the reasons why we love Atlanta for SFR investing. We'll also talk about some of the non-real estate factors that make Atlanta a great place to build our portfolio.
Real Estate Factors
Strong Job Market and Population Growth
Atlanta is a major economic hub in the Southeast, with a strong job market and a growing population. Job growth reached 22.8% from April 2020 to year-end 2022, exceeding the national growth rate of 11.7%. This creates a demand for rental housing, which can be a good investment for institutional investors.
Relatively Affordable Housing Market
The cost of housing in Atlanta is still relatively affordable compared to other major cities in the United States. As of February 2023, Zillow reports the average home value in Atlanta to be $402,030, significantly lower than cities like New York and Los Angeles.
Higher Rental Yields
When we started the business, rental yields were still favorable in Atlanta. Higher rental yields means that investors can generate a good return on their investment.
Low Vacancy Rates
The vacancy rate for rental properties in Atlanta is relatively low at 5.4%, compared to 5.8% national vacancy rate. This means that investors are less likely to have trouble finding tenants.
Strong Appreciation Potential
The real estate market in Atlanta has been appreciating steadily in recent years, which means that investors have the potential to see their investments grow in value over time.
But there's more to Atlanta than just these real estate factors. Below is a list of additional considerations that make Atlanta a favorable environment to build out Ascend and our Renting with Benefits product.
Robust Tech Ecosystem
Atlanta is a thriving tech ecosystem, which attracts talented professionals. This helps our team build a local presence beyond our NY office.
Favorable Regulatory Environment
Atlanta has a favorable regulatory environment for real estate startups. This enables Ascend to launch our innovative Renting with Benefits model.
With Atlanta’s real estate tailwinds, there is strong demand for real estate services and innovation. This creates a large pool of potential customers for our Renting with Benefits product.
Atlanta has a supportive community of real estate professionals who are willing to help us and other startups succeed. You’d be surprised how many markets are not open to innovative operators.
The Ascend team will continue to release more content to highlight why we invest in certain markets. We hope you enjoyed this blog post. If you have any questions, please feel free to reach out to us at firstname.lastname@example.org.