“Hotlanta” Leads Nation for Suburban Renter Growth
We’ve heard a lot about millennials flocking to the city centers as they chase after jobs and the benefits of the sharing economy. But a new report shows that the biggest U.S. metros are experiencing a renter “boom” in the suburbs — and RentCafe says suburban Atlanta is at the top of that list.
The RentCafe report says it looked at Census data for a 5-year period, from 2011 through 2015. And, it found that urban centers have not gained as many renters as we’ve come to believe. In fact, it says the numbers show that suburban areas gained substantially more renter households than their urban counterparts in 19 out of the 20 metros it reviewed.
In Atlanta, the data shows a net gain of 52,300 suburban renter households during that time frame — a 26% increase. That’s a huge number of additional renters in just a 5-year-period. Atlanta’s urban area only gained 15,100 renters which reflects a 10% increase.
Suburban rent growth was so strong in Atlanta, St. Louis, Riverside County California, and Boston, it was “three” times that of their more urban counterparts. RentCafe says of the 20 metros areas it studied, suburban areas gained about 700,000 new renter households in that 5-year period. City centers in those same areas gained about 600,000.
In Riverside County the percentage of suburban renter growth was lower than Atlanta but the overall number of new renter households was much higher, at 60,500. Just 18,500 renter households were added in urban areas. Chicago also saw substantial suburban renter growth, along with Miami, and Dallas.
RentCafe says the main reason for the shift is “cheaper rents”. Renters are also getting more family-friendly neighborhoods with garden-style apartment communities. They are also finding that schools are usually better in the suburbs, neighborhoods are quieter, and their living expenses take a smaller bite out of their paychecks. RentCafe says that an analysis of the Yardi Matrix database shows that renters save about 11% or a month’s worth of rent if they move to the suburbs, based on average rents in the 20 areas studied.
So what is going on in Atlanta, or “Hotlanta”? Mainly, the city is making some big quality-of-life improvements with major redevelopment plans. All that growth is contributing to job growth as well, while making the city a more attractive place to be.
Here’s a short list of some of the revitalization efforts in Atlanta:
There’s a huge project underway called the “Atlanta Beltline”. It’s a project that will connect 45 city neighborhoods with a 22-mile loop of multi-use trails, streetcars, and parks. The Beltline website says it has received several awards as for its visionary approach to making the city more walkable, bike-able, and oriented toward public transit. The project is making use of long forgotten rail lines that circled the city.
This is expected to have a similar affect that the Highline has had in NYC. If you haven’t walked that yet, you’re in for a treat. Next time you’re in the Big Apple, check out how the city has built a public park on top of an historic freight rail line that’s elevated above the streets on Manhattan’s West Side.
Back to redevelopment plans in Atlanta… The former Bellwood Quarry is being turned into a huge park and reservoir. You may have seen the stunning granite quarry walls and bright blue tint of the water in scenes for “The Hunger Games”, “The Walking Dead”, and “Stranger Things”. The city is investing at least $300 million dollars to turn the water-filled quarry into a 2.4-billion-gallon reservoir. When it’s done, it’s expected to hold a 30-day supply of drinking water for 1.2 million people. The city will develop the surrounding 300 acres as the city’s largest park, which will also be connected to the city via the Beltline.
The former Fort McPherson Army base is being converted into a huge movie studio complex. African American filmmaker Tyler Perry bought the historic 330-acre piece of real estate in 2015 and is turning it into the latest version of his Tyler Perry Studio. The L.A. Times reports that when it’s done later this year, it will be one of the largest studios in the country. The paper also says that Tyler hopes to create 3 to 4,000 news jobs at the studio, and recruit people from low-income parts of Atlanta.
Major upgrades are also coming to one of Martin Luther King Junior Drive which runs right through the city center — past the state capital, the historic Atlanta University Center, and the Georgia Dome. It’s a 12-mile stretch that has become an eyesore with old or abandoned buildings in need of repair. The city plans to convert the 4-lane road into two traffic lanes, and two for bicycles. There will also be new roundabouts, plant-filled medians, small parks, and new pedestrian crosswalks.
And then there are two new sports stadiums in the making. Both the Falcons and the Braves are building new stadiums. That’s expected to bring tens of thousands of new jobs to the city. And the city is already experiencing job growth that’s higher than the nation’s average. The latest report from the U.S. Department of Labor shows that Atlanta experienced a 3.6% growth rate for non-farm jobs in the last year. Jobs for the professional and business services industry grew the most at 4.6%. That’s well above the 3% growth rate for that sector nationally.
Percentage of Suburban Renter Growth
These are just a few things going in what many are now calling “Hotlanta” — and that’s why we’re actually featuring the city at our live event this weekend. The speaker will be a real estate investor from Atlanta who helps investors buy income properties in the path of progress. He has provided property in the past to many New York hedge funds. Real Wealth Network investors will be excited to learn from him to understand which neighborhoods are destined for massive growth and how to acquire income properties that will benefit from city improvements.
As for the percentage of suburban rent growth for the other areas, Phoenix and Riverside County came in with a 23% increase. Tampa, Dallas, and Minneapolis range from 18% down to 15% growth in suburban renters. Detroit, Miami, and Denver experienced a 14% renter growth rate in the suburbs. Houston, Washington, D.C., and Seattle were all at 13%. Chicago was at 12%. San Francisco at 10%. San Diego and St. Louis were at 9%. Los Angeles, Boston, New York, and Philadelphia were at the bottom of the list with a 7% to 3% suburban rental growth.
If you’d like a referral to our team of real estate experts in Atlanta who help investors find investment properties in the path of progress, join the network.
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