Monthly Archives : January 2023

What You Need to Know About Vacation Property Investments in Blue Ridge, GA

Have you ever considered purchasing a vacation rental or short-term rental (Airbnb/VRBO) property? You’ve probably heard many others talk about this. If you’re like me, what you’ve heard about these properties sounds too good to be true, but you may have also heard others having terrible experiences with these investments. Short term rental opportunities are starting to diminish, yet if you’re going to enjoy your purchase in addition to renting it, it’s a lifestyle investment. While interest rates have increased and made payments higher, will it be worth more if you intend to hold for 7-10 years?

We have researched many areas and discovered that Blue Ridge, Georgia offers the most benefits for short term rental investment for buyers in the Atlanta area. Here are my top six reasons for why this could be.

1. Blue Ridge has year-round rental appeal. There are activities to enjoy in every season. Summer: Lake Blue Ridge, world-class whitewater rafting on the Ocoee River, or fly fishing on the Toccoa River are popular attractions. Fall: Foliage brings guests to the area and local festivals draw large crowds. Winter: Light Up Blue Ridge festival, Santa Express on the Blue Ridge Railway. Year-round: Trout Fishing – Fannin County is the Trout Capital of Georgia. There’s also mountain biking year-round with an abundance of trails from easy to difficult. Mercier Orchards is the largest orchard in the south. The orchard draws visitors year-round, peaking during apple picking season. Hiking: There are over 300 miles of trails and 16 beautiful waterfalls in the area.
2. Over the holidays, there’s strong demand for cabins where family and friends can come together for Thanksgiving, Christmas, and other holidays in a group setting. Year-round, there is an abundance of hiking. There are over 300 miles of trails in the area! The panhandle/30A area is popular with Atlanta buyers looking to host; however, it is very seasonal and generally limited to spring break and a few months during the summer. It can be extremely difficult to ever turn a profit.
3. Taxes: Fannin County property taxes are much lower than taxes in other counties and especially less than in the state of Florida.
4. Downtown Blue Ridge: The town is a draw for many reasons. The Historic Blue Ridge Railroad, dining, shopping, and nightlife all draw crowds. There’s an artsy vibe with many galleries. The Blue Ridge Railroad offers seasonal trips as well, such as the Firecracker Special and Santa Express. The appeal of downtown Blue Ridge is broad reaching and not reliant on one attraction. This ensures you have guests interested in visiting at all times.
5. Wineries: There are very nice wineries in the area. There are also winery tours (and craft brew tours, too). From a short-term rental benefit perspective, this brings in groups of friends coming for a fun weekend to tour the wineries, who generally will rent a cabin together.
6. Blue Ridge supports tourism. Some local governments look to control or even eliminate short term rentals by adding restrictions or large fees. The Blue Ridge economy is driven by tourism and the local government supports it. Currently, Blue Ridge requires you to obtain a Short Term Rental Certificate. The cost is minimal at $25 per year.

I have personally invested in both beach and mountain vacation properties, and Blue Ridge has been the best for us. Winter, Spring, Summer or Fall — the Blue Ridge Mountains are beautiful. We wanted to confidently help our clients invest in Blue Ridge as well. To do so, we have partnered with Tracy Krohn. Tracy has a wealth of local knowledge, having grown up here and worked in the area extensively. Tracy personally owns a vacation rental in Blue Ridge and she can help you understand recent rental income trends and operating expenses so you can make an informed investment decision. If you want to explore the area and learn more, connect with us and we’ll connect you with Tracy to get started!

“Behind the Curtin” provides an inside look at local homeowners’ beautifully-crafted houses, giving insight into what it takes to renovate, upgrade, and style the most coveted parts of their dream homes. In this video series, industry expert and business owner Joanne Curtin explores local homes while interviewing their owners along the way to better understand their thought processes when making important decisions. Join Joanne to get a look into the world of thoughtful real estate one wonderful home at a time.

“Behind the Curtin” Episode 2 – A Pool and Pool House in Milton, Georgia

WATCH THE FULL EPISODE HERE

Tripp and Grace Melton live in Milton, Georgia. They have been residents since 2003. In 2020, they began the work of creating an outdoor space for relaxation and entertaining, with a pool and pool house.

Joanne: Why did you pick this area?

Tripp: We were working downtown at the time and couldn’t find anything we liked. And then we drove through this area and liked the idea of a newer construction.

Grace: Even though the house wasn’t initially what I had in mind, I fell in love with the hidden pantry in the kitchen and the fireplace in our keeping room looks like the wall in the church where we go married.

Joanne: What have you done specifically to increase the value of your home?

Grace: We made a lot of use of the outside space and tried to do some thoughtful landscaping with trees and buffers because the way the house is situated, you can see the whole backyard from the street. But the biggest thing was adding the pool in 2020 and the pool house.

Joanne: Did you use a designer to create the outdoor living resort space that you have?

Tripp: No, these are all our ideas, even the landscaping. We worked with our pool builder for the pool house to execute what we wanted.

Joanne: What do love about the outdoor space you’ve created?

Grace: For me, I love being around water. I like seeing it, I like hearing it. I think it’s calming, but it’s also a great entertaining space. And we use it year ‘round, because we’ll have the pool heated. We can go out here for coffee in the morning or have friends over late at night. We use the fireplace and the electric heaters in the middle of winter, and so we spend a lot of time in the pool house. It’s been fun.

Joanne: Where did you find vendors and contractors for such a big job?

Tripp: We went to our original builder. They gave us some ideas and some referrals. We also did a lot of research online about what we wanted.

Joanne: So, what did you splurge on?

Tripp: The sliding doors on three sides of the pool house was almost a third of the cost of the entire pool house. But the space is transformed when they are opened or closed. The pool house stays cool in the summer and comfortable in the winter. Also, our ceiling fan from Big Ass Fans Company, is large enough to create a nice breeze.

Joanne: What else do you really like about the space?

Grace: The vaulted ceiling. It’s not just a flat ceiling, so I think it’s a nice, added dimension.

Joanne: What have you learned from the process?

Tripp: I’ve learned from this process to get everything in writing. In the end, even when you’re dealing with friends or people you like, it’s still a business transaction.

Joanne: Is there anything you would do differently?

Tripp: We weren’t able to put in a bathroom because of the rules regarding septic fields, unless we wanted to install another septic system. However, we finished the basement with an additional bathroom that allows us to have a changing room for the pool.

And some people have asked why didn’t do an outside kitchen. I mean, we just don’t use our inside kitchen that much. So, it wasn’t a big deal for us.

Joanne: What advice would you give someone who wanted to renovate their outdoor space?

Grace: I would say good design that’s really well thought out. And materials, don’t skimp on materials.

Tripp: I would tell someone don’t skimp on the decking. For example, the travertine around the pool is cooler in the summer than pavers or concrete. I would also not skimp on lighting. We changed our ground lighting to soffit lighting and it changes the whole look. We also installed a cool sound system through a Sonos sound system with speakers shaped like rocks around the pool area.

If you’re considering continuing to rent, maybe you think it’s best to wait until prices come down, or maybe you’re waiting for interest rates to come down. Or maybe you just don’t see the value in taking on the responsibility of owning a home. But did you know home ownership is one of the largest factors in building wealth? It is the differentiator between those that bought and those that continue to rent. How big of a difference can it really make, you ask? Let’s look at the tale of two friends, Harry and Randy, and really dive into the numbers to see what a difference buying a home now and continuing to rent will make in a 7-year period.

Harry Homeowner just purchased his new home for $400,000. He used FHA financing and put 3.5% down, or $14,000. His loan would be $392,755 because of the up-front 1.75% mortgage insurance that gets rolled into the loan on FHA loans. His monthly payment would be:

Principal & Interest – $2,613
PMI – $273.42
Estimated Taxes & Insurance – $474
Total payment = $3,360.76

After 7 years, Harry will have paid $181,546.66 in interest and $34,171.22 in principal, leaving a loan balance of $351,829.02. Harry has gained $34,171.22 in principal paydown, which can also be looked at as a forced savings. But wait – it gets better. Harry will also gain equity. The average equity increase annually is 4% (in metro Atlanta, it’s been 5% average.) After 7 years at an average of 4% annual appreciation, Harry’s home is now worth $526,327. That’s a gain of $126,327. Adding in the principal paydown of $34,171, Harry is sitting on a nice $160,498 gain. Harry could access some of this equity through a Home Equity Line of Credit and perhaps purchase an investment property (smart choice Harry!) or decide it’s time to upgrade and roll those gains into a new home and start the process over.
Another scenario that would likely have occurred for Harry is that because of the gain in the property value and equity, the PMI would drop off – most likely Harry would have refinanced his house and the payment would have reduced by $300-$400, so Harry’s payment in year 7 would be estimated to be around $2,900.

Randy Renter is renting a cool two-bedroom apartment in a hip, walkable location for just $2,000/mo. Instead of making a mortgage payment, Randy is a disciplined dude and he is saving the difference in his rent payment and what his friend Harry is making in a mortgage payment. So he’s saving $1,360 per month.
Randy is smart with his money, and he’s invested it in a mutual fund and was able to obtain an average annual return of 12%. Randy would now be sitting on a cool $167,000.
Aha you say: “So buying is not the right move! I’d actually have more money by saving money by renting (assuming you’re as disciplined as Randy) and not buying.”
However, we didn’t factor in that rent continues to increase every year. So in reality, Randy’s fixed cost of living continues to increase, while Harry’s fixed housing cost is locked in (and likely reduced when he refinances). Let’s rerun this scenario factoring the rent increases and consequently the savings decreases for Randy.
Average rents increase by 6% per year in our area. Randy’s two bedroom apartment rent looks like this over 7 years:
Year 1 $2,000
Year 2 $2,120
Year 3 $2,247
Year 4 $2,382
Year 5 $2,525
Year 6 $2,676
Year 7 $2,837
At the end of 7 years, again Randy is super disciplined and did not touch any of his savings, he now has $138,855 saved.

Let’s compare.
Harry has $160,498 in equity/net worth.
Randy has $138,855 in equity/net worth.
Harry has a fixed monthly housing payment.
Randy also has a monthly payment that will continue to rise and is beyond his control.
Randy can buy too, but the same house Harry bought 7 years ago will cost Randy a lot more.
It has been said “the best time to plant a tree was 30 years ago, the second-best time is today.” The same can be said of real estate. Don’t wait to buy real estate, buy real estate and wait!