Saturday, December 15, 2007

More Atlanta foolishness

I had to read this article twice to make sure I didn't miss something. But no, I didn't.

With more, higher-priced living quarters available, the average income of new downtown households is expected to increase from $61,000, the average in 2000, to $71,000 by 2012, the RCLCO report stated. The expected household income increase is key to attracting the “proper retail for the market audience,” said Ellen Mendelsohn, a project manager with CAP’s economic development department.

“In real estate, it’s hard to make money when you are buying at the top price right off the bat. … I was amazed at some of the prices we were able to get buildings for in Atlanta—there’s a desire to be downtown—not everyone can afford a $500,000 condo in Buckhead,”
Uhuh. So $71K household income justifies $400K condos downtown?. That is still 6:1 ratio of price to income. You're right, not many people can afford. That doesn't mean lots of people still didn't buy those $500K condos using ninja loans. Ahh but Atlanta didn't have a housing boom so there will be no crash. Keep saying that yourself developers if it makes you sleep better at night.

Secondly that increase works out to 1.5% a year. Yet these tools are celebrating this increase as some kind of proof that downtown households are upper end? A 1.5% annual increase in incomes is something to be worried about. Even using the bogus govt inflation numbers of 2% a year, downtown is getting poorer in real terms. But why let facts get in the way of a good real estate swindle?

Now hurry up and buy today before you get priced out. Today's $500K condo will be $5M in 5 years and you better get in now while you still have a chance at living the downtown condo American Dream.

Buy for $400K?

$400K mortgage at 6.5% is $2528
taxes at $350
HOA $300 a month

Total cost: $3178


rent the exact same thing for $2200

I dunno...$3178 or $2200 a month for the exact same thing.

Tough call.

1 comment:

Anonymous said...

Paying either amount for an apartment is insane.