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Woodstock Draws Office to Live, Play Community

By Geoff Smith

City leaders in Woodstock have worked hard over the last 20 years crafting what has become one of the metro area’s most successful suburban downtown areas. And as the saying goes, success breeds success.

When I was at Chattahoochee High School back in the early 1990s and we traveled to Cherokee High School to play football, it seems like we made it west clear to Alabama. The country started pretty much right after Crabapple Road on 92 in west Roswell and went on for what seemed liked forever. If you grew up in the metro area and have not been to, or heard what’s going on in, Woodstock lately, then you are probably wondering why in the world I’m writing about it.

A real estate agent friend of mine was driving around a family who wanted a house in Roswell for under $350,000. They could not find what they were looking for. She kept telling them about Woodstock, but they just turned up their nose – would not entertain the thought. So my friend headed up Arnold Mill, pretended to get lost, and wound up in downtown Woodstock. That family now lives in Woodstock.

Woodstock had some decent bones to start off with. The town, like many, grew up around a small rail stop. The old town spread along Main Street and one side of the railroad tracks. The other side of the tracks was mostly woods.

City leaders back in the early 2000’s got aggressive and saw what many at the time did not. They partnered with some local developers and coordinated a town center that consists of several city blocks, some five-story buildings filled with condos, apartments, and retail and restaurants on the bottom, and an entire neighborhood of detached and attached homes, all around a very wooded neighborhood park.

The downturn in 2008 halted the project for a spell. But it got back up and going and is at this point running full-steam ahead.

The new buildings are all leased up. The old town on the other side of the tracks is leased up and restaurants seem to be clamoring to get in. A fantastic concert venue called MadLife opened up. It’s a venue that looks like an old jazz club with a huge stage, high-top table seating and a bar on the lower level, and an upper level with a bar. Quality music acts play there almost every night.

And they love their beer in Woodstock. Reformation Brewery is about a mile down Arnold Mill road, and they are planning a new location in downtown. Reformation has expanded and it’s hard to find a grocery store locally that does not carry their product. They also had a great growler shop that grew into a bar/restaurant. The shop’s owner had a great idea to open a bar focusing on carrying a wide-variety of micro-brews, with space behind the bar for a different food-truck to pull up every night. The idea was so new, that the city was not sure how to approve it. It was a restaurant without a kitchen. It was a bar that technically did not sell food. It went against their existing guidelines. But what did Woodstock do? It said ‘hey, this is a great concept. This would make our downtown better. Let’s figure out how to make it work.’. And it did. The second location is going up in Alpharetta’s downtown.

That attitude has created a downtown so successful that city leaders are now getting inquiries from developers who want to build Class A office space nearby. Businesses want to be where the action is. And if Woodstock’s attitude towards those projects is similar to how it took on development of its downtown, Woodstock will soon be a true live, work and play community.

The Data Says Buy A $900,000-House

By Geoff Smith

If you are looking for a new home under the $400,000 price-range, I know how competitive it is. But after some serious research, I have found a solution for you: go buy a $900,000-house.

If only it were that easy!

I just finished reading through Smart Real Estate Data’s third quarter newsletter and I’m stunned again by the lack of inventory available to most homebuyers. Our homebuilders can’t seem to catch up to the demand that is out there.

Inventory is measured in ‘months of supply’. The numbers reflect the months it would take for homebuyers to buy up all the currently listed homes if no new houses came onto the market. Experts consider a healthy housing economy to have 6.5 months of supply. Why is it unhealthy for there to be more or less? Supply and demand.

If you have less months of supply, then the demand is stronger than the supply and home prices rise quickly as buyers compete for the relatively low number of houses on the market. If you have more than 6.5 months of supply, then it’s a buyer’s market and values can drop as sellers compete for the relatively few buyers.

In the below $300,000-market, there are less 2.5 months of supply. That is one of the lowest months of inventory in the history of people keeping track of these numbers. In the $300,000 to $400,000-range, it only rises to just above 2.5 months. The $500,000 to $600,000-range is where the market finally starts getting healthy with about 6 months of inventory. Above that and it quickly gets unhealthy again with inventories above 7.5 months.

By the way, that $900,000 to $1M-range I mentioned at the beginning of this article has well over 10 months of inventory. It is a good time to get a deal in that range.

Based on the laws of supply and demand, prices on sub $400,000-homes are rising and on the $600,000-homes are lowering. Maybe someday everything will be priced around $500,000!

Obviously that won’t happen. But the laws of supply and demand are making the lower priced homes even more expensive, eventually creating even less inventory for a market already starved for inventory. Capitalism usually has a way of evening these kinds of things out. But building houses in the sub $300,000-range is a hard thing to do these days.

Land has gotten more expensive in the metro area. Builders are having to pay more to comply with an increased number of regulations that most residents want, and pay more for increased impact fees which help fund capital improvements to fire, police and other municipal departments. There is a labor shortage in the construction industry, so builders are having to pay more to lure subcontractors away from other builders. And with unemployment so low in general, we are not seeing employees from other industries jumping over to meet the demand.

The average price of a new home was $334,977 for the third quarter. With the increased costs, the builders are having to build more expensive homes to keep their margins. But if you look at the more expensive homes – there is a relative glut. The demand is for the lower-priced homes.

In the coming years, it’s very possible that we could see more effort from both the private industry and the public, to find creative ways to build more, lower-priced homes.

Some cities and counties are seeing this as an ‘affordable housing’ crisis where many of the people who work in their police, fire and retail service sectors are not able to live close to where they work. I’ve heard some folks try to blame the developers. But developers are pretty simple creatures. If the project will make their business money, they’ll probably build it. If it will lose their company money, they probably won’t. They know the demand is there, it is just hard to make the numbers work.

Atlanta Area Demographic Data

by Geoff Smith
If your household earns more than $77,233, then you have made it into the top 40% of income earners in the metro Atlanta area. I would bet more than 90% of you reading this article fall into that category. But hold on, the numbers jump quickly as we climb to the top. To get into the top 20%, your household needs to earn more than $122,065. And finally, to get into the top 5% of all income-earners in the metro Atlanta area, your household needs to bring in more than $234,699.

The Census numbers I saw didn’t break it down further than that. But if you are still wondering, a CNN chart predicts that you have to earn more than $440,000 to be in the top 1% of all U.S. income earners.

If you are sour because you did not make it in the top 5%, here is something to boost your spirits. All of you are probably in the top 1% of income earners in the world. To do that, according to Investopedia, your household needs to earn more than $32,400 a year.

Mortgage Rates Jump

Mortgage interest rates jumped this week, moving up at the fastest pace since last June. Much of the movement, according to experts, has to do with a hopeful outlook that lawmakers will be able to pull off some form of tax reform.

Most investors believe this would be good for business. And when they believe that, they invest more money in stocks than in the more risk-averse market of bonds. And when bonds are bought in low volumes, mortgage interest rates rise.

What this Means to You:

According to Mortgage News Daily’s Rate Survey, best execution rates for a conventional 30-year fixed are at 4.09%.

Why North Fulton is So Stinking Great

By Geoff Smith

The Alpharetta Hotel and Conference Center should be complete in Avalon early next year

The Alpharetta Hotel and Conference Center should be complete in Avalon early next year

I was born in North Fulton, raised in North Fulton and I live with my family today in North Fulton. I have a good many friends up here who have said I should get out more, but you know what? All those friends moved here – to my home.

Roswell's locally renown Canton Street during an Alive After Five event

Roswell’s locally renown Canton Street during an Alive After Five event

If you know me, you’ve heard me say this: I’d rather be from the place everyone is moving to, than the place they are all moving from. And for the last 43 years, people and businesses have fought to get into North Fulton.

Some say that North Fulton’s success is because of the fiber-optic cable that was laid along roads in Alpharetta in the early 1990s. Others say it was Jim Cowart’s vision to build the first gated community of Country Club of the South. I’ll add that it was Roswell’s vision back in the 1970s to develop what just recently was awarded the Gold Medal Award for the best Recreation and Parks Department in the entire country.

You could keep going further back to Roswell’s founder, Roswell King in the mid-1800s. He stopped in Roswell to build a cotton mill. He was from Connecticut and back then, the south shipped most of the cotton it grew to the north for processing. The finished products were shipped back down here to sell. King started the mill to cut out the shipping costs and boom – a successful business town was born.

It is beautiful country up here. Roswell has about 10 miles of the Chattahoochee River running through it, and Johns Creek has about 13. Big Creek flows from Forsyth County with a near-continuous bike path along it through Alpharetta to Roswell. Take a drive through Milton’s horse country and you’ll get jealous in a hurry that you don’t live there. Go to Canton Street in Roswell, or see what’s going up in downtown Alpharetta near Avalon and you’ll feel the same way.

One of Milton's many horse farms

One of Milton’s many horse farms

It’s no wonder people want to pay top dollar to live here, and businesses want their employees to work here. Alpharetta has more than 600 technology companies within its borders. Windward Parkway should be a brand in itself. Johns Creek is awash in successful corporate offices – its downtown is essentially a grouping of corporate campuses.

When they look for a move, today’s corporations are trying to think like millennials – who will make up half of the workforce by 2020. Most think that means moving intown near mass transit and in areas that are highly walkable and full of action. North Fulton is countering this with the most desired suburban downtowns in the metro area and an incredible collection of undeveloped parks that take full advantage of the river and creeks. Roswell owns more than a mile of parkland along the Chattahoochee that is already master-planned. And once developed, will be a park not just enjoyed here in North Fulton, but admired throughout the metro area. It will surely be yet another draw for businesses looking to make a move.

John's Creek recently approved plans for a linear park near some of its office parks

John’s Creek recently approved plans for a linear park near some of its office parks

I have not even mentioned the schools, but by almost any measure, you will not find a collection of higher-performing public high schools anywhere in Georgia. U.S. News’ rankings have 6 of the top 8 public high schools in Georgia as being located in North Fulton.

North Fulton didn’t get this way because of a few major events. It got this way because great servants in our community took these great resources and worked them inch-by-inch, project-by-project and success-by-success to piece together what I think is the best place to live, work and play on the planet(a new friend of mine said its better than her home city of Paris, France. So…). The key now will be to take what we have been given to the next level so that my two boys will say the same thing in 30 years. And with the resources we already have, the sky should be the limit.

Market Watch

Rates Sitting Still… Still

Mortgage interest rates have not really budged from this time last week. There is talk about a new tax plan, talk about the Executive Branch rolling back some policies involved in the Affordable Care Act, and talk about the Fed standing firm on several interest rate raises throughout next year. But at this time, investors seem to be saying…”that’s just talk.” They all seem to be from the “Show Me” state this week. Mortgage Interest rates are holding firm to recent highs.

What this Means to You:

According to Mortgage News Daily’s Rate Survey, best execution rates for a conventional 30-year fixed are at 3.96%.

Downtown Lawrenceville Awash In New Development

By Geoff Smith

Suburban downtown areas are flush with redevelopment these days as cities and developers rush to meet market demands of residents who want to be close to where some action is. Lawrenceville is the latest to double-down on this idea.

A couple years ago, or really any time in the history of the Atlanta metro area, I would have trumpeted what is going on in downtown Lawrenceville as epoch development. But these days, what they are doing is keeping up with what’s going on in other cities like Alpharetta, Sugar Hill, Chamblee, and Sandy Springs. All that said, there are at least three major projects going on in downtown Lawrenceville that will transform a city that already has seen significant downtown development.

The projects include almost 40 acres of mixed-use development and a 2.2-mile linear park that will connect Georgia Gwinnett College with the downtown district, and open up development opportunities along the way.

The biggest project being proposed is a 32-acre development behind the Lawrenceville Lawn Park and around City Hall that would include 600 residential units – 435 multifamily units and 159 single-family and townhouse units. Within that project would also be about 15,000 square feet of retail. Novare Group is the developer and is scheduled to present the project to the city in December, according to the Atlanta Business Chronicle.

Just across the Lawrenceville square and on 7.5 acres that used to be the site of the now demolished Lawrenceville High School(built in 1895), Richport Properties is proposing a $20 million mixed-use development. The project, being called City View, would include 58 single-family homes, townhomes, “cottages” and office space. According to the AJC, the developer is under a purchase-sale agreement with Lawrenceville’s Downtown Development Authority.

The linear park is a significant project, mostly because of the opportunities it will create. This project has been in the planning stages for several years and the city has recently hired Georgia Development Partners to run construction of the project, which is expected to begin next month, according to the Gwinnett Daily Post. In addition to a new two-lane road, the project will include multi-use trails, bike paths, roundabouts and landscaping features. Multiple pocket parks and detention ponds are also shown in the plans – as are spaces for new townhomes, a restaurant, some retail space and a multi-level residential structure.

One of the biggest things this corridor would do is connect the roughly 11,000 students enrolled at Georgia Gwinnett College with the downtown district and the two other projects mentioned in this article. The corridor will also fold in an existing brewery named Slow Pour Brewing Company, and 550 Trackside, a popular event facility housed in the city’s old train station. It should take about a year to demolish some of the buildings in the corridor to make way for the new road and trails. At that point, construction on the new infrastructure is said to begin.

I imagine that retail businesses in downtown Lawrenceville are chomping at the bit to see these projects completed. With almost 660-residential units going in, they will see a significant increase in night-time and weekend customers. And with the office development and the connection to Georgia Gwinnett College, they will see a significant increase in daytime customers during the weeks. It will be a good time to be doing business in Lawrenceville for sure.

Beltline Creator Sets Sites on Buford Highway

By Geoff Smith

There isn’t much doubt about it, most people will finally agree that there are really great restaurants throughout the metro Atlanta area.

Growing up in Roswell, it seemed that transplanted New Yorker’s loved to complain about the food. The Italian food was boring, there were no good bagels, and forget about finding a good Chinese restaurant. Well nowadays, I don’t hear that kind of talk. Folks are pretty fat and happy in Atlanta.

Chefs have grown more and more creative. And creative in a way that draws people consistently into their restaurants. Different parts of the metro area are developing their own styles too. Canton Street in Roswell has more great restaurants per square foot than maybe anywhere else in the metro area, all serving out of buildings first built in the late 1800s. Alpharetta’s restaurants are a bit more spread out and refined, but fantastic. Ponce City Market in Atlanta has its food court packed with several unique and great restaurants where most of the seating is stretched along barstools.

Perhaps the most unique area walks a thin line between being considered under the radar here in Atlanta, and well-known among chef circles outside of Atlanta. It is Buford Highway. Written up in Bon Appetit, this 7-mile stretch of road heading north from I-285 was called a “United Nations of restaurants.” In this stretch of road you can get Vietnamese, Korean, Chinese, Indian, Somali, Mexican, combinations of those, and many other types of food. Some of you might think that you’ve got Vietnamese, Chinese and Mexican restaurants close to your home. But the difference here is that these restaurants cook their food as if they are serving not Americans, but people from their home countries.

It has developed a serious ‘it’ factor. So much so that when Anthony Bourdain, a king of cool, brought his show to Atlanta, he spent a lot of time eating in, and complimenting restaurants there.

To the eye, this stretch of road is probably not the most inviting stretch of road. These great restaurants are scattered throughout strip malls that were built during a time when we had little ability for urban planning. But that could be about to change.

One of Atlanta’s king of cool, Ryan Gravel, is setting his sites on Buford Highway.

If you do not know, Gravel conceptualized the idea of The Beltline while a student at GA Tech, and then worked as a planner to make it a reality. The Beltline has become one of the most successful redevelopment ideas of our time anywhere in the country and has transformed every community it runs through. He left The Beltline project because he thought they were getting away from his idea to incorporate more affordable, lower-income workforce housing.

According to Reporter Newspapers, Gravel created a nonprofit called Generator. Its mission is to be an “idea studio…committed to the production of ideas about cities that nobody is asking for.” His first Generator workshop will be a School of Design class at Georgia Tech that will focus on Buford Highway.

According to the article, he finds this area interesting because it deals with a lot of issues that are prevalent throughout the country. There is a large immigrant population there, and he sees this as a way to create a solution for suburban immigrant populations throughout the country. They are going to look at different transit options and different ways to move people around. His design principals will go much deeper than transit and affordable housing options too. He wants to create ways to force people to interact and “love” each other more.

Best of GA Fall Blows Through the Mountains

By Geoff Smith

This is the time of year in Georgia when spurts of cool breezes blow through the humidity and heat, and tickle our spirits into a state reminiscent of an old college buddy popping in through the door to whisk you off to one more, wild weekend. Or at least into trying to be fancy with your writing of a business article.

Truth be told though, there are few places on the planet better than Georgia in the fall and spring. It’s a proven fact…probably. The weather is a big reason that so many people have moved down here – just ask someone from the great city of Chicago.

This time of year, those cool breezes move my attention to the mountains. Standing mountaintop, looking out miles and watching the wind blow up and down the red- and gold-covered hills and valleys, will lead you to a true moment where you say “there really is no other place I’d rather be.” And there are many great places to go in the North Georgia mountains. Blood Mountain is one of my favorite spots. It’s just north of Dahlonega and is an easy day trip. You could drive up GA400, enjoy the ride, park at the base of the mountain, hike to the top, enjoy the open views and be home in time for dinner. Or, better yet, eat on the square in downtown Dahlonega.

Georgia’s mountain towns have developed nicely over the years and there is a wide variety of places to go visit. There are relatively large cities such as Dahlonega and Clayton that are surrounded by great parks and nature, but also have large commercial districts and hotels. Then there are also small towns like Blue Ridge and Ellijay that have just enough.

Perhaps the most visited, or most known, is Helen. This city was originally founded as a logging town, but in the last 1960’s reinvented itself as a Bavarian alpine town lined with buildings modeled after many of the great south-German cities. It has become crowded over the years and is flooded throughout the day and night with sounds of loud motorcycles, but it has a thriving commercial district with shops and restaurants, is built along a much smaller and younger Chattahoochee River and is surrounded by awesome sites like Anna Ruby Falls, Unicoi State Park and Dukes Creek Falls.

Blue Ridge and Hiawassee are two of my favorite North Georgia towns. Both have nice-enough downtowns, good restaurants, and are surrounded by fat mountains. But what they also have are incredible lakes. Lake Blue Ridge and Chatuge Lake are surrounded by mountains, have clear water and whisper serenity.

That said though, if I’m talking about North Georgia lakes, I have no choice but to mention Lake Burton. As far as beauty and serenity goes, it has both Chatuge and Blue Ridge beat. Located just west of Clayton, it is also lined with some of the most expensive real estate in the state. Many famous people have houses there including Nick Saban and country music star Alan Jackson, and houses go easily for $2M to $5M. I spent part of a summer in college working at Camp High Harbour, which long ago secured a prime spot on the lake. The owner of Waffle House had just bought the small mountain next to the camp and was in the process of blasting off the top of it so he could have 10 flat acres. I bet it’s interesting walking around the grocery store on the weekends there these days.

In Georgia, there are countless day hikes, waterfalls, small lakes and small towns. Oh – and canyons. Right. Cloudland Canyon is one of our recent finds. It is awesome and is about a 20-minute drive from Chattanooga, TN. Last time we went we camped there and drove into the city for dinner. It was fantastic.

Bottom line is, it’s that time of year again. Do yourself a favor: just pick a spot and go.

New Construction at Pre-Recession Levels

Inventory Still Historically Low

Courtesy of Smart Real Estate Data

By Geoff Smith

For the first time, new home construction closing numbers are competing with pre-recession levels. And it’s nowhere near enough.

According to numbers just released from Smart Real Estate Data, there was an estimated 5,566 new construction closings in the 2nd quarter of this year, and 10,182 closings in the first half of this year. These numbers are similar to numbers posted in the first half of 2008, which was right before the collapse.

And this trend doesn’t appear to be slowing down. In the 2nd quarter, 7,110 new home permits were issued – the most permits issued for a quarter since 3rd quarter of 2007. So clearly with all of this new construction going on, we must be flush with new homes on the market. Right? Wrong.

In most markets, it is hard to find and buy a house. Housing inventory is measured by the numbers of months it would take to sell out all existing listings with no new listings coming to market. Most experts agree that a healthy market is with 6 months of supply. At that mark, home values are increasing at a safe pace. With too much inventory, sellers are competing for limited buyers and home values can actually start to drop. With too little inventory, buyers are competing for limited houses and home values rise too fast. Right now, inventory is historically low at an average 3.29 months. It’s the lowest level since they’ve been recording this type of data. And that number is trending downward. Inventory averaged 3.63 months the same time last year.

And in keeping with the laws of supply and demand, the invisible hand has pushed home prices up an average of 5.6% over the last year. In some markets its less than that, and in others it’s much more.

You might think that since new construction pace is back to pre-recession levels, and inventory is still low, then resales are probably down. You might think that, but you’d be wrong. In the 2nd quarter of this year, the metro area set an all-time record for the most resale closings in a quarter with 25,992 closings. So why is inventory so low then?

Here is why: we are adding more new homebuyers to the market than homes being built. Over the last three years, according to the U.S. Census Bureau, the metro area’s population has grown by an average of just over 20,000 people per quarter, or about 7,000 people a month. Not all of those people need a home as families are included in those numbers, but add to those numbers the amount of first time homebuyers trying to move out of their parents’ basements and you have more new homebuyers than new homes coming to market. And this trend doesn’t look like it will be changing anytime soon. So that is leaving the door open for other types of housing to grow.

“All around Atlanta’s core are apartment buildings going up left-and-right,” said Mitchel Palm, Senior Associate with Smart Real Estate Data. “That is where a lot of these people moving to Atlanta are residing.”

Homebuilders are trying to do their part, but Palm says a lack of affordable, developable land, inflation on building materials, and a lack of skilled labor are sucking the wind out of their sails.

An interesting point that stuck out to me is that we are nearing peak levels of new residential construction, but our inventory is shrinking. The metro area has become massive. We are operating in much deeper waters than we were just 9 years ago. The city’s success is attracting people from all over the world.

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