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Case Study: Why are Atlanta Rents Soaring?

Updated: Mar 7, 2021

As an investor and syndicator of multifamily properties in Texas, Georgia, and Florida, I keep a sharp eye on rents and their overall impact on our properties. The election is over, there will be a new president, and we’re still in the middle of a world-wide pandemic. While the economy is struggling and many Americans are out of work, rents in some markets are soaring. Atlanta is one of those markets. As a devotee of statistics and having a huge passion for analyzing data, trends, and numbers, I wanted to find out the reasons why, as learning the reasons behind this huge rent increase makes me a smarter investor.

After all, Blue Lake Capital owns over 740 units in the Atlanta area alone, and our rents have increased by up to a whopping 40%, which represents a $375 per month increase for some of our units. That would be unheard of during regular times, but those numbers are astounding during an ongoing COVID pandemic with record unemployment numbers. Additionally, while many people are now protected from being evicted thanks to the new national eviction moratorium others who are unemployed and unable to pay their rent could be facing eviction in January. So, why is it that some markets have soaring rents while others are struggling?

Atlanta Rents have Surpassed Pre-COVID Levels

Rental rates in Atlanta have surpassed pre-COVID levels, and as a data driven investor, I wanted to understand the reason for that phenomenon. Part of the answer comes down to supply and demand. Where the rental demand is strong and supply is somewhat limited, the rents will go up.

The main reason for the increase in demand for multifamily properties these days: people are leaving New York City in droves, and record numbers of those leaving are moving to Miami and Atlanta. The moves out of New York City started before COVID struck, which has only helped to exacerbate the number of people leaving. However, what is really telling are the rising number of moves out of New York City when comparing 2019 to 2020. In 2019, according to, an online moving resource guide, there were 18,887 people who moved out of New York City. In 2020 the city lost 110,978 people to other states and cities.

Atlanta doesn’t have the same vibe as Miami, nor does it have the same caliber of entertainment and dining. However, when people began looking for a market that was more affordable than Miami, the next choice was Atlanta. In fact, during the second quarter of 2020, Atlanta had a net gain of 6,600 residents.

Certainly, NYC rents are a major factor for the moves, where a studio apartment can rent for up to $3500, but there are other factors as well. Density in New York City was cited as one of the driving forces for motivating people to leave the densely populated city. COVID was found to spread in densely populated areas, so people left to protect their health and the health of their families.

Another factor that came into play was that it was no longer necessary for many workers to go into an office. Major companies in the city were issuing work from home mandates in an effort to control the spread of the COVID virus. Online interaction via Zoom and other apps have replaced conference room meetings. While that will ease up once the COVID-19 vaccine becomes widely available, many companies have decided that working from home is an economic boost to their bottom line, and many have no immediate plans to ask workers to return to the office. Many companies have told their employees that working from home is perfectly acceptable for the foreseeable future. That’s not to say that the “new norm” is widely embraced, as there are many advantages to having in-person, face-to-face interactions between colleagues.

Atlanta Was a Strong Real Estate Market Even Before COVID

I always tell investors that if you’re going to invest in multifamily real estate be sure that you’re investing in properties located in a strong real estate market. Atlanta fits that bill, and people aren’t migrating there just because rents are lower than Miami. A strong market has growth, and that includes job growth, population growth, and rent growth, and you really need a balance of all three for a strong market. As Atlanta has all three growth elements, it’s considered a strong market.

The reason that a balance of all three growth elements is needed is when a lot of people move into a market to pursue job opportunities, if the market has an overabundance of multifamily properties, rent growth will be stagnant. That means that despite value-add renovations, it would be hard to increase rents. When there are limiting factors to rent growth, revenue, and income, you’re not in a strong market.

I’ve also mentioned that you want to invest in a landlord friendly state, and Georgia qualifies. This is reassuring to investors, because if you invest in value-add improvements, you don’t want to have regulations in place limiting how much you are able to raise rents. You also don’t want to find yourself in a costly and lengthy legal battle evicting someone who won’t pay their rent. Finally, I always look for markets where property values are increasing, because while there is no guarantee that the property will be increasing when you go to sell it, it’s always better to invest in markets where you see values increasing, versus one where they’re not.

Renovations and Value-Add

During COVID, we have continued moving ahead with renovating our units. I’ve found that tenants are willing to pay a higher rent for a renovated apartment, even during COVID. The renovation work may include new appliances, new countertops, hardwood floors, and updated bathrooms, along with other upgrades. The difference between the rent for a non-renovated unit and a renovated one is called the “premium,” and it could generate an additional $250 - $300 per apartment per month. That’s a substantial amount of increased income when multiplied by the number of total renovated units. That increase in income goes to our bottom line, which will hopefully increase the profits as well.

For upgrades to units, our value-add improvements might include replacing older appliances with stainless steel ones or ones with the new black finish, installing new plank flooring, painting the units, adding new kitchen and bathroom cabinet doors, and adding new hardware. It might also include installing new lighting and installing a new kitchen backsplash. Depending on how many improvements are made, the costs can range from $2K to $7K.

To help differentiate units from the competition and add appeal to the tenants we’re trying to attract, we might also install Nest digital thermometers, keyless entries, and other similar upgrades. With regard to the property, improvements may include adding new amenities like a yoga studio, an Amazon locker, adding reserved or covered parking, providing valet trash service, including washers and dryers in each unit, and many other similar additions. Some of these additions may generate monthly fees, increases in rents, or both, or they may simply be used to rebrand the property to attract a more upscale tenant.


With no stimulus package in sight, many renters are struggling to pay their rent. Thanks to the new eviction moratorium, nobody can be evicted through the end of the year if they follow certain protocols and file specific documents to prevent the eviction. The tenants are still liable for the rent, but unless there’s a new moratorium or extension in place, the back rent will be owed on January 1st.

While some renters are struggling, others are paying on time, and paying increased rents as well. We have over 740 units in Atlanta, for example, and we were able to increase our rents by 40% during the COVID pandemic. That’s an amazing increase, and by analyzing the numbers, I found the reasons we were able to achieve that increase.

A lot had to do with people in New York City leaving the city, and the two major markets they were moving to were Miami and Atlanta. As rents in Atlanta were lower, many moved there, which was fortunate for our company. Atlanta is a growing market, in population, employment, and rent. That makes Atlanta a strong real estate market. With new companies moving into the area, the outlook is very positive. Georgia is a landlord-friendly state, which prevents limits on how much we’re able to raise rents, while making it easier to evict non-paying tenants.

We’re moving ahead with our value-add strategy, renovating units with new appliances, flooring, cabinet doors, lighting and more. We’re also adding amenities to both the units and the property in order to help attract the type of tenants we’re looking for. This will lead to increased rents, income, and profits.

Want to Invest with Ellie?

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About the Author

Ellie is the founder of Blue Lake Capital, a real estate company specialized in multifamily investing throughout the United States. At Blue Lake Capital, Ellie helps investors grow their wealth and achieve double-digit returns by investing alongside her in exclusive multifamily deals they usually don't have access to.

Ellie is the host of REady2Scale , a podcast that highlights honest, insightful, and thought-provoking discussions on the multiple approaches for successful real estate investing.

She started her career as a commercial real estate lawyer, leading real estate transactions for one of Israel’s leading development companies. Later, as a property manager for Israel’s largest energy company, she oversaw properties worth over $100MM. Additionally, Ellie is an experienced entrepreneur who helped build and scale companies by improving their business operations.

Ellie holds a Masters in Law from Bar-Ilan University in Israel and an MBA from MIT Sloan School of Management.

You can read more about Blue Lake Capital at and learn more about Ellie at


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