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Open Threads: Midtown Real Estate Guru Answers Questions

We fielded questions about a segment of Atlanta with boundless cosmopolitan potential: Midtown. Chiming in today is Thom Abbot, of Thomas Ramon Realty. He's been selling Midtown real estate since 2004, and he operates the site MyMidtownMojo.com. Some thoughtful questions, and insightful answers, ensued ...

Curbed reader Question #1: Most two-bedroom homes in Midtown don't provide a lot of outdoor space. For those that do, how much does the size of the area (terrace, fenced back/side yard, etc.) make a difference in the value of the property?

Thom Abbot: The overall size of a lot will have an impact on the value of a home, certainly. HOW that space is used, is another factor. If a big chunk of your back yard is consumed by a double-car garage, what's worth more? More back yard, or off-street parking? I'd think parking. It's often expected in an urban area like Midtown Atlanta that you are not going to have a ½ acre lot. And some will want yard, and others want the privacy of a house (and no HOA to work with) but do not want all the yard work.

Question #2: I'm currently a college student interested in selling luxury real estate in Atlanta. I grew up here so I'm very familiar with a lot of neighborhoods as well as different things occurring in the city. My question is, for someone like myself who has yet to receive a real estate license (which I am woking on getting now), what would you recommend I do in order to learn about the real estate market? I've called all around the city inquiring about potential internships with different firms but no one seems to offer them.

TA: Luxury real estate can be defined a number of ways. But let's say it's for homes priced over $1 million. That is not a market you are going to just walk into and start selling. Most agents that work this market have been doing so for years, and have built a referral network and business over time. Agents can be quite territorial in sharing information ? you could be their new competition. My recommendation is to start with a firm that gives you good training (real estate school does not teach you how to SELL real estate, it teaches you how to get a real estate license) and look for additional training outside of your company to learn more.

Lastly, the multi-pronged Question #3: 1. I've been keeping an eye out for 1800 sq. ft. 3/2s in Midtown, and Colony & Hanover House seem to stand out as a good deal less expensive ($/sqft) than the others. Is this because of something wrong with the building(s) such as high condo-fees or is it due to the low number of these units out there? 2. Given a multi-family unit (say 2/1) with few amenities versus a similarly sized SFH in midtown, will one or the other appreciate much faster than the other? 3. Do you have a personal favorite building in Midtown? 4. For the existing Novare condos (and the like), will they not see good appreciation when all of these new apartment buildings convert to condos?

TA: First off, the size of condo you are looking is a challenge in Midtown Atlanta. There are not many options at that size, and if they are there, the price reflects the size. Colony Square and Hanover House have a great location in Midtown, close to the High Museum and Piedmont Park. You might pay less for a home in Colony Square/Hanover House, but to most Buyers, the HOA fees are simply too high. Keep in mind, it does NOT include parking, yet another monthly expense. You might be able to afford $700-1700 per month JUST for your HOA fee, but not every buyer can. Hence, how easy will it be to resell in the future? Also, neither building is FHA approved, so that means a buyer needs to have a substantial down payment to purchase ... a challenge for many buyers today. The amenities are limited, and there is a no-rental policy. You suddenly get transferred, what do you do with your home if you can't sell it?

Appreciation in real estate is effected my many factors. Condition, location, age all play a factor in a property. In Midtown, a duplex will have more investment potential as you can rent out BOTH portions. Single Family homes in Midtown are large, historic homes, so they are somewhat one-of-a-kind (in Midtown) so there will always be a demand for that type of home, considering the limited geographic area they are located in.

Every building has its great points. One might like Plaza Midtown because you have a Publix on the ground level, but another might like having a rooftop Zen garden like Viewpoint. I try to point out the positive and negative features of any building to a Buyer I'm working with depending on what THEY are looking for. It's about the Buyer, not about me.

The $50 question or the elephant in the room: What WILL happen WHEN any of the new apartment buildings convert to condominiums? UNTIL it happens, with limited inventory and no new construction, we should see values increase in existing home sales (condos) in Midtown. It would depend on what price point any given building enters the market as to what would happen with resales. They may continue strong, or you could see Buyers rush for the "shiny new toy" of a new building.