OC Apartment Brokers
SoCal Multifamily Sales Pulse -August 29, 2021 - September 4, 2021
Disclaimer: All information contained herein is obtained from sources believed reliable. We have not verified it and make no guarantee, warranty or representation about it. Any projections, opinions, assumptions or estimates used are for example only. We make no claim(s) as to the accuracy or reliability of the information presented. If you wish for us to analyze your specific property or situation please feel free to call or email us anytime.
Here's What's Happening In The Market, Here’s What This Means For You
Does Biden Administration Look to Jeopardize Benefits of 1031 Exchanges?
In a recent Green Street report, sources say that “while prior administrations have suggested ending 1031 exchanges, chances are better now that it will happen.” The threat is real. One of the differentiators this time is the amount of stimulus that has been pumped into the economy, and, not surprisingly, policymakers are looking for revenue to offset the debt that has been created.
Biden has proposed ending 1031 exchanges to help fund his proposed child care and family-leave legislation. There also are ongoing talks over increasing capital-gains taxes, which would hurt institutional owners more but would still cut into private-capital profits.
Some owners are choosing to sell now even though doing so would incur taxes, and others are waiting to see what happens with the tax code. If wealthy individuals lose the favorable tax treatment, they are less likely to sell properties moving forward. Owners whose cost of capital increases because of harsher tax treatment likely will hold properties longer.
Feel free to give me a call to discuss your options and
whether or not it makes sense for you to sell now or wait.
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Are you a tired landlord looking for an out to the moratorium "situation"? Reach out to me regarding special pricing on listing and selling your property quickly. |
Orange County
Orange County multifamily had 21 Closed Sales Last Week. This is the highest number of weekly closed sales we’ve in several months. The Closed Sales - Average Days on Market remained low at just 29 days. Out of the 21 Closed Sales Last Week there were 13 Transactions Sold At or Above Asking Price.
Orange County’s SALE OF THE WEEK was this 6 unit building on Porter Ave. in Fullerton. This 6 unit building was built in 1958 and consisted of all 1 bedroom 1 bath units. The property was located on a cul-de-sac in what’s known as the Porter Avenue Villas. It was listed at $1,475,000 and sold for list price, all cash, as soon as it hit the market. It was previously on the market for 407 days at $1,500,000 but never sold. The property sold at $375 per sq. ft. and there was room to increase the rents about 10%.
As far as listing inventory goes, Orange County had just 6 New Listings Last Week. This is quite a bit off from the norm. Orange County typically averages about 10-15 new listings per week. The Months of Inventory dropped from 4 months previously to just 2 months currently. With the Absorption Rate dropping from 2.63 months to just 1.75 months, this is the lowest Absorption Rate out of the 5 Southern California counties. The Orange County multifamily market just keeps getting tighter and tighter.
Looking at the 3-year trend charts you can see from the Number of Monthly Sales; overall activity was up last month. The Days to Sell, Average was up slightly but remained in the 30’s. But the big story is The Number of Active Listings dropped below 200 for the first time in the past 3 years and the Number of New Listings last month was just 68 new listings. This is the lowest Number of New Listings we’ve seen since December of last year.
List of Closed Sales
Live MLS Link SALE OF THE WEEK
Southern California
Long Beach multifamily had 10 Closed Sales Last Week. This is about average for Long Beach weekly closed sales. The Closed Sales - Average Days on Market was lower than normal at just 22 days. Out of the 10 Closed Sales Last Week, 6 Transactions Sold At or Above Asking Price and 5 closed sales were All Cash Transactions.
This week's Long Beach SALE OF THE WEEK is this 8 unit building located on 62nd Place on the Peninsula in Long Beach. The units were four 1 bedroom 1 bath and four 2 bedroom 1 bath. The property was built in 1964. It was originally listed at $3,300,000 and sold for $3,475,000 in 15 days. The property is just one building from the sand. This is a perfect value add property as most if not all of the units are in need of upgrading. Rents were low and could be increased by as much as 20-50%.
With just 6 New Listings Last Week the Long Beach listing inventory remained below 100 for the 4th consecutive week. Months of Inventory dropped to 3 months after being at 5 months previously. Active Listings, Dollar Volume dropped to just over $230,000,000 and hasn’t been this low in months. Long Beach’s Absorption Rate dropped from 3.21 months to just 1.98 months. This gives us a further indication that the Long Beach market continues to be highly desirable for investors.
Looking at the 3-year trend charts there was a big increase in Number of Sales last month with 49 closed sales after just 33 closed sales in the prior month. The monthly Days to Sell Average continued dropping. The Active Listings Number is now at its lowest point since January 2020. So, if you’re considering selling your Long Beach apartment building now would be a good time since inventory is at a low point not seen in almost 2 years.
List of Closed Sales
Live MLS Link SALE OF THE WEEK