UPDATE: Apartment Sales Remain Strong

"As other markets fall out of favor with investors, particularly office and retail, a lot of investors are spending more money in apartments," Scott Levitt, director of investments, Lane Realty Advisors Inc., tells Globest.Com.

Garden apartment sales so far this year totaled $339 million, according to a report by the Atlanta office of CB Richard Ellis Inc. That represents a 31% increase over the $259 million during the same period last year.

Prices are also going up. The median per-unit price paid for a metro area apartment this year is $55,096, an increase of around 16% over last year's per-unit cost of $47,589, according to statistics from the local office of Marcus & Millichap.

Money for apartment loans is not a problem. "Mortgage money is not an obstacle," says Mark Obrinsky, vice president of research and chief economist for the National Multi-Housing Council. "Borrowers with good credit can get loans. Lower interest rates have had an impact on apartments as well as in other areas."

Lane's Levitt says it helps that Atlanta is one of the few formerly hot markets in the country where apartments are not too out of balance with supply and demand.

"We see the apartment market softening somewhat, but it should stabilize," he tells GlobeSt.com. "Atlanta and South Florida are still two of the best markets in the Southeast and the only two where we're not seeing significant losses in leasing."

With job growth shrinking, some areas in Atlanta are just now starting to offer a month's free rent, but it's nothing like the several months of free rent being offered in some markets, Levitt says.

His company recently paid $18 million or $63,380 per unit for the 284-unit Keswick Village in suburban Atlanta. The company plans to hold onto the property for five to seven years and then turn it around.

Private investors are also increasingly active in the local market, says Jim Jarrell, senior associate, Marcus & Millichap.

Some REIT's are eager to sell properties because they don't fit in with corporate strategy or have enough potential for revenue and profitability. The Atlanta-based Gables Residential Trust recently sold its last remaining complex in Atlanta.

The selling trend may not only continue strong but could pick up steam later in the year. In years past, about 40% of the year's apartment sales took place in the fourth quarter.