The Atlanta housing market has been one of the hottest in the nation thanks to its relative affordability and strong job market, among other factors. It even ranked among the best cities for job seekers in 2022 and was named a top spot for renters too.
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For investors, Atlanta offers many opportunities for growth. Both home values and rents are on the rise, annual rental returns are solid, and, compared to other major metros, property taxes are on the lower end.
Are you considering investing in the Atlanta real estate market? Here’s what you need to know about the city’s housing.
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Atlanta’s median sales price growth is outpacing that of the nation, and its home values have increased significantly in just the last four years.
Despite this, the city’s price per square foot is still largely affordable, and job growth and strong interest in the area support solid renter interest moving forward. Atlanta even made Forbes’ list of best cities for renters earlier this year due to its sizable apartments, relatively low-cost rents, and abundant parks.
Atlanta home values have skyrocketed over the last few years. While the uptick started long before the pandemic emerged, growing post-COVID remote work opportunities only increased interest in this Georgia metro — particularly from buyers in costlier housing markets along the coasts.
According to the Zillow Home Value Index, home values in Atlanta have jumped nearly 30% in the last year and almost 80% since 2017. Values are up from just $200,827 in March 2017 to $360,679 now. That means if you’d invested in a $300,000 home in 2017, you’d own a home worth nearly $539,000 today — a significant jump in equity in just five years.
Atlanta housing sales prices have grown considerably in recent years, according to Zillow. As of March 2022, median Atlanta sales prices clocked in at $356,374 — a 19.5% increase compared to March 2021 and a 52% jump from March 2018, when prices sat at just $234,452.
If those numbers weren’t telling enough, comparing them to national averages makes the growth even more notable. Nationally, home prices rose 14.9% annually and almost 42% over the last four. Atlanta outpaces the nation on both counts.
Atlanta home prices are on a tear lately, but to truly find the best investment market, it’s important to compare those numbers to other major metros you might be considering.
According to our analysis, Atlanta’s price growth is slower than red-hot markets like Austin, Texas (which saw prices rise almost 70% in the last four years) and Tampa, Florida (where prices jumped 62.5%). However, Atlanta’s home prices outpaced both Charlotte, North Carolina and Denver, Colorado. In the latter, prices have risen 41.5% since 2018.
When compared to other major metros, Atlanta also claims a pretty affordable price per square foot. At $171.80/sq. ft., it’s cheaper than Austin, Charlotte, Denver, and Tampa — and by quite a bit in some cases. In Denver, for example, you’ll pay a whopping $286 per square foot, while in Austin, it’s $260.
Still, Atlanta’s price per square footage is on the rise. It’s notched a 24.4% uptick in the last year and a 78.4% jump over the last five years. Price per square foot is rising faster than in Denver (21.1% in the past 12 months) but slower than in all three other metros we analyzed. Tampa has seen its price per square foot jump almost 30% in the just the last year.
It’s no secret that housing inventory has been in short supply across the nation. And Atlanta is no different. The metro has seen available listings dwindle significantly in recent years, notching an almost 15% drop since March 2021 and a 94% decrease over 2018.
It’s not all bad news, though. Atlanta’s dip in inventory is actually smaller than most other metros we looked at (Tampa’s fell a whopping 36% in the last year), and Redfin has dubbed the Atlanta housing market only “somewhat competitive” as of April 2022.
Potential properties are out there, and the proof is in the numbers. The metro notched 7,481 home sales in February 2022 — more than Charlotte and Denver combined. Be warned, though: Homes are selling quite a bit faster than they were just last year, so you’ll want to act quickly if you see a property you like.
In February 2022, homes sold in a median of 17 days — 22.7% quicker than 12 months prior. Compared to five years ago, the median days on market (DOM) is down more than 73%. Homes are now selling faster than in both Austin and Charlotte, though Denver and Tampa properties are moving at a quicker pace (five and nine DOM, respectively).
Any real estate investor knows it’s all about location. While choosing the right metro is a good start, you also need to pick the right neighborhood within that city to ensure strong demand and solid returns.
To guide your property search in the Atlanta housing market, we’ve pulled together the 10 most expensive and least expensive neighborhoods in the area — as well as those that have seen the most and least growth.
Yes, it is a good time to buy a house in Atlanta. Home values have steadily climbed in the area for many years, meaning homebuyers will see a good return on their investment fairly quickly. Though the market is competitive, data indicates it may not be as hot as other major metros in the U.S.
It’s unlikely that Atlanta’s housing market will crash anytime soon. Demand remains strong, and inventory is limited, which will keep the market in check for the foreseeable future. While higher mortgage rates could cut into demand, it’s more likely that price growth would simply slow down as a result — not reverse course and start dropping.
Atlanta has certainly seen growth in recent years, but compared to many markets, it’s still relatively affordable. As long as demand remains strong, buyers should see their home values grow steadily in the coming years.
There are many factors that influence a metro’s rental market, including jobs, population growth, and even local for-sale housing inventory. For example, when home listings are limited or housing prices rise too much, more locals may be forced into renting. This drives up demand for rentals, as well as the price landlords can ask for them.
The hot housing market is definitely trickling down to Atlanta’s rental scene. Median rents in the city have climbed nearly 20% in the last year, clocking in at $1,886 per month as of March 2022. Since March 2017, rents have jumped over 43%.
That last stat outpaces every other major metro we analyzed, as well as the national average. Nationally rents are up just 27% in the last five years and 17% since March 2021.
Prices, of course, vary by rental size. According to ApartmentList, Atlanta studio rentals and four-bedroom properties have seen the most growth, with 43% and almost 52% jumps, respectively. The median rent on a four-bedroom is now nearly $2,100 per month.
Despite rising rents, investors seem to be making less than they were in years past. Data from Zillow shows that rental yields are down almost 1% over the year and have decreased more than 5% in the last five years.
Still, the city pulls in solid returns regardless. The typical landlord notched a 6.42% yield in March 2022. While that’s less than the national average of 6.77%, it’s notably higher than what investors in Charlotte, Denver, and Tampa saw for the same month.
The declines in yield are smaller than in other cities, too. Tampa rental yields dropped almost 19% over the last five years, while Charlotte’s fell 11%.
Georgia is largely considered one of the nation’s more landlord-friendly states. It doesn’t have rent control laws, the eviction process is simple, and there are no limits on security deposits.
In Atlanta specifically, tenants do have the option to purchase rental security insurance instead of paying a deposit but only in certain circumstances.
Atlanta also requires:
Landlords will also need to return a tenant’s security deposit within a month of move-out.
Atlanta claims pretty low property taxes when compared to other major metros. In fact, out of 50 cities analyzed, LendingTree found Atlanta claimed the 15th-lowest median property tax bill in the nation. The typical property owner pays just over $2,100 annually in taxes.
Keep in mind: This is just a median. As the Atlanta metro spans many counties, each with its own tax rates, this number could vary widely across locations. According to a SmartAsset analysis, the Atlanta counties with the lowest effective property tax rate are Rockdale County (0.66%), Cobb County (0.72%), and Heard County (0.72%).
Georgia also offers a rental property deduction if your expenses on the property outweigh the income you earned from it. If this happens, you can deduct the loss from your total taxable income — up to $12,500 — and reduce your tax burden.
Price is only part of the equation when tenants are choosing where to live. They also consider things like walkability, school quality, employment opportunities, quality of life, and more. Let’s dive into how Atlanta measures up on these fronts.
Atlanta, as a whole, is a pretty car-dependent town, but there are definitely some communities that are more walkable (and bikeable) than others. Public transit is also fairly accessible in a number of neighborhoods.
According to Walk Score, here are the top spots if you want to invest somewhere walkable, bikeable, or with good public transit:
Keep in mind that investing in the Georgia State University area will likely mean investing in student housing. While this does come with some risk, it also ensures steady demand from local GSU college students.
Atlanta is home to a number of well-rated public, private, and charter schools, most of them located in the northern and eastern suburbs of the metro.
The Buckhead neighborhood is home to the best schools, including Brandon Elementary, which claims a 9/10 above-average score on GreatSchools.org. In the north, the Dunwoody area is also home to a number of well-ranked schools, and in the east, Virginia-Highland and Morningside-Lenox Park also claim public good school districts.
The two top-rated charter schools in Atlanta are the Drew Charter School, located in East Lake, and Kipp South Fulton Academy, located south of the city in East Point.
A strong job market means a healthy stream of renter and buyer demand, so it’s important to choose a city where employment and industry are growing. Atlanta is strong on both counts and was even named a top spot for job seekers earlier this year.
The U.S. Bureau of Labor Statistics shows Atlanta employment is on the rise. The metro saw jobs increase 6.3% in February 2022 — well above the 4.9% national increase. It also ranked sixth among the top 12 metros in terms of year-over-year job growth.
Employment is up considerably in the city’s professional/business services, trade/transportation/utilities, and leisure/hospitality industries. WalletHub ranked it the No. 27 best city for jobs (out of 182) earlier this year.
Now, down to brass tacks: Is Atlanta affordable? Does it offer a good quality of life? These are the things that will make or break an investment property, so taking them into consideration is critical. Let’s look at both elements more in-depth.
The National Association of Home Builders’ Housing Opportunity Index is a good gauge of housing affordability. According to its latest numbers, just under 67% of all Atlanta homes are affordable to someone earning the area’s median income. That share has dropped from nearly 77% at the start of 2020.
It sounds worrisome, but compared to all four other cities we analyzed, Atlanta is actually the most affordable. It’s also more affordable than the national average, which shows just 54% of homes are within reach for the typical earner.
U.S. News & World Report ranked Atlanta the No. 55 best place to live last year, citing its overall value and strong job market. The city scored a 7.2/10 for jobs, a 6.6/10 for desirability, and a 6.9/10 on value. It scored lowest on quality of life (5.9/10).
Atlanta also made it on another list: Forbes’ tops spots for renters. According to the publication. Atlanta is the sixth-best city for renters, thanks to its easy-to-access parks, relatively low rent, and sizeable rentals. The ranking took into account other factors, like weather risk data and rent-to-income data, too. One hundred cities were considered.
Atlanta has a lot to offer its residents, including a strong job market, a number of quality schools and universities, and a wide variety of attractions and amenities. The city is home to five professional sports teams, a bustling restaurant scene, and dozens of cultural hotspots, including the Atlanta History Center, the Georgia Aquarium, the Atlanta Botanical Gaden, and the Alliance Theatre.
Though some neighborhoods are an exception, Atlanta does lack accessible public transit — particularly compared to many larger coastal markets where many residents may be moving from. It also comes with extreme heat and humidity, and traffic, due to the city’s huge reliance on cars, is also a commonly cited complaint.