Jodi Summers = Multiunit Real Estate

WESTSIDE APARTMENT MARKET UPDATE > WE’RE TALKING BRENTWOOD, WESTWOOD, BEVERLYWOOD, BEVERLY HILLS, SANTA MONICA, VENICE AND MARINA DEL REY

May 9, 2013 on 3:32 pm | In Buyers, Charts + Statistics, Curious, Fascinating Information, For Your Purchasing Pleasure, Market Snapshot, New Developments, Rents, Sellers, Trends, Uncategorized | No Comments

by Jodi Summers

Thinking about buying apartments on the Westside of L.A.? Here’s a tip for you, the Brentwood/Westwood/Beverley Hills submarket is expected to record the highest rent increase due to the paucity of new construction.

The last 12 months has seen 650 new multifamily units become available on the Westside, increasing stock by 0.5%, according to Marcus and Millichap in their recent Apartment Research Report. Approximately 380 of those units were delivered in the Santa Monica/Marina Del Rey submarket during that time.

Traditional vacancy rates for the area have been between 3.1% and 2.2% for the past two years. New units at high prices have pushed up the Santa Monica/Marina Del Rey vacancy rate to 3.6% in the first quarter. The Santa Monica/Marina Del Rey submarket is slated to receive 1,150 new units this year.

Effective rents at professionally managed properties on the Westside climbed 4.5% to $2,346 per month between Q1 2012 and Q1 2013. But, the Santa Monica/Marina Del Rey submarket recorded a 1.3% decline in effective rents to $2,647 per month to compete with new units. In Brentwood/Westwood/Beverley Hills, effective rents jumped 8.9% to $2,515 per month. Throughout the area, average revenue climbed 4.1% over the past year.

Competition for tenants is up, lease rates are down. Purchase prices are up, cap rates are down. Indeed, investors acquired 30% more apartment properties in the Westside Cities submarket during 2012 than 2011. In the most recent 12-month period ending in 1Q13, the median sale price climbed 11% to $227,000 per unit. The average number of units per deal hovered near 15 units as buyers sought assets that do not require on-site management. Cap rates are averaging in the high-4% range, down .4% from the previous year.

The desirability of the Santa Monica/Marina del Rey submarket is allowing sellers of local assets to command higher prices. Experts believe that future rent gains and appreciation are being priced into assets, which will raise challenges when the market begins to cool. Looking a bit further east to Brentwood/Westwood/Beverley Hills may yield purchases with better returns.

We’re here to help you with your real estate needs. Please contact Jodi Summers and the SoCal Investment Real Estate Group @ Sotheby’s International Realty – jodi@jodisummers.com or 310.392.1211, and let us move forward together.

https://www.marcusmillichap.com/services/research/webreports/LosAngeles/Apartment.aspx

http://www.socalmultiunitrealestateblog.com/?p=2415

http://www.kearch.com/wp-content/uploads/2012/12/koningeizenberg_village_d_1.jpg

SOCAL MULTIFAMILY REAL ESTATE SNAPSHOT ~ APRIL 2013 ~ GROWING DEMAND

March 31, 2013 on 7:55 pm | In Buyers, Charts + Statistics, Market Snapshot, Rents, Sellers, Trends, Uncategorized | No Comments

by Jodi Summers

“We have a new generation coming into the work force they’re demanding multifamily housing, we’re seeing rental rates go up and vacancy rates going down,” shares Jerry Nickelsburg, Senior Economist for the UCLA Anderson Forecast.

Research concludes, multi-family housing developers remain upbeat in the key California markets of Los Angeles, San Francisco, and Silicon Valley…and they’re not just optimistic about the present, they’re confident that the multifamily market will stay strong for the next three year.

In the aftermath of the housing bubble and financial crisis, Americans have caught on. They have made three major improvements in their living conditions:

(1) reducing their private debts

(2) containing their expenditures, and

(3) living closer to work, ready to relocate if needed.

These three elements are influencing many Americans to move from single-family to multi-family homes. Reis Reports notes that apartment vacancy rates have declined to 4.5% (the lowest rate since 2002) in Q4 2012 from a peak of 8% in Q4 2009.

“One of the real bright spots in coastal California is multifamily markets,” confirms Nickelsburg. “Economic growth is going to translate into even more rapid growth in California because technology is driving this recovery, manufacturing is driving this recovery, and California is still the largest manufacturing state in the country. What that translates to is rising incomes in California and rising demand for multifamily housing.”

http://uclaforecast.com/allenmatkinsCRES/

http://www.youtube.com/watch?v=8f1wUAkNMZE

http://www.socalmultiunitrealestateblog.com/?p=2382

http://www.bloomberg.com/image/igjtGgi3PJGM.jpg

http://www.jewishjournal.com/los_angeles/article/israeli-americans_make_good_on_giving_back_20120509

http://www.calculatedriskblog.com/2013/01/reis-apartment-vacancy-rate-declined-to.html

TOP 10 CITIES FOR APARTMENT RENT STICKER SHOCK

March 19, 2013 on 5:31 pm | In Curious, Fascinating Information, Market Snapshot, Of Local Importance, Rents, Uncategorized | No Comments

by Jodi Summers

When first time renters start searching for an apartment in Los Angeles, they get sticker shock. Rental rates tend to be at least a third higher than they imagined.

According to the newest data from Apartments.com, many Gen Y-ers and other first-time renters are way off on what the going rate is for an apartment in many of the most popular U.S. cities. And the price they are hoping to pay just doesn’t exist in many markets.

Los Angeles is 7^th and North Hollywood is 10^th on the list of the Top 10 cities where renters severely underestimate the actual cost of rent when conducting their apartment searches online. Sometimes what someone wants to pay is nowhere close to what they will have to pay. Here’s the cities where renters and landlords are the furthest apart…yo shout out to Brooklyn:

http://www.multifamilyexecutive.com/rent-trends/10-cities-where-landlords-and-renters-are-miles-apart-on-rental-rates.aspx?utm_source=newsletter&utm_medium=email&utm_campaign=MFECC_102312

http://www.socalmultiunitrealestateblog.com/?p=2199

http://stuytownfiles.files.wordpress.com/2012/07/stuy-town-rent-hikes.jpg?w=580

PROPERTIES FOR SALE IN OCEAN PARK, SANTA MONICA ~ 3-19-2013

March 10, 2013 on 6:47 pm | In Buyers, For Your Purchasing Pleasure, Market Snapshot, Of Local Importance, Uncategorized | No Comments

by Jodi Summers

Finally, we have some inventory in Ocean Park, Santa Monica. There are currently nine properties for sale in our dynamic walkable neighborhood at the beach, just north of Venice. Every day feels like a holiday in Ocean Park. Here’s what we can help you buy today, courtesy of Jodi Summers and the SoCal Investment Real Estate Group @ Sotheby’s International Realty – jodi@jodisummers.com or 310.392.1211, and let us move forward together.

2721 2ND ST # 112

asking price: $499,000

1 Bedroom, 1 Bathroom

IF YOU LIKE QUALITY & LOCATION, THIS RARE CORNER UNIT, OCEAN PARK, BEACH PAD IS FOR YOU. NICELY UPDATED & READY TO GO. LARGE NEW WINDOWS LOOKING OUT TO GREEN GRASS LOCATIONS. CROWN MOLDING THROUGHOUT. GATED, 2 CAR TANDEM PARKING (RARE FOR 1 BR UNIT). BEAUTIFUL FLOORS. GREAT NATURAL LIGHT & OCEAN BREEZE. OPEN FLOOR PLAN. SECURED COMPLEX.

3007 3RD ST # A

asking price: $649,000

2 Bedrooms, 2.00 Bathrooms

AN ABSOLUTE DIAMOND IN THE ROUGH IN A SENSATIONAL LOCATION! THIS IS A WONDERFUL CRAFTSMAN COTTAGE SITTING ATOP THE HILL, IN OCEAN PARK, WITH OCEAN VIEWS AND A BEAUTIFUL FRONT GARDEN AREA WHICH WITH A LITTLE IMAGINATION COULD BE SENSATIONAL! NOT FOR THE FAINT OF HEART, THIS EXTREMELY PRECIOUS TURN-OF-THE-CENTURY 2 BEDROOM, 2 BATHROOM COTTAGE IS READY TO BE REMODELED AND RE-IMAGINED!

2960 NEILSON WAY #105

asking price: $690,000

1 Bedroom, 1.50 Bathrooms

GORGEOUS CORNER UNIT WITH LARGE PATIO TO TAKE IN GREEN BELT VIEWS AND WONDERFUL OCEAN BREEZES AT PRESTIGIOUS SEA COLONY II. ENJOY ALL THIS LOCATION HAS TO OFFER. CLOSE TO THE OCEAN AND MAIN STREET SHOPS AND RESTAURANTS. SIDE-BY-SIDE PARKING AND 24 HOUR SECURITY.

3118 LINCOLN

asking price: $1,295,000

# Units: 1, Lot Size: 4,652

FANTASTIC OPPORTUNITY ON HIGH TRAFFIC LINCOLN BLVD. CORNER LOT – LINCOLN AND NAVY. SMALL IMPROVEMENT ON PROPERTY. CURRENT TENANT IS CAR DEALER. 2003 PHASE ONE ON FILE. ZONED SMC4.

208 BICKNELL AVE

asking price: $1,395,000

# Units: 2, Lot Size: 4,796

WELL MAINTAINED DUPLEX NEAR THE CORNER OF BICKNELL AND MAIN. C2 ZONING. GATED ENTRANCE, WITH AMPLE PRIVATE PARKING FOR MANY CARS… TENANT OCCUPIED, PROPERTY SHOWN WITH ACCEPTED OFFER.

652 KENSINGTON RD

asking price: $1,395,000

3 Bedrooms, 1 Bathroom

BUNGALOW-INFLUENCED 1927 HOME IS LOCATED IN A QUIET NEIGHBORHOOD BLOCKS TO THE BEACH. INTERIOR REQUIRES YOUR ATTENTION WITH KITCHEN & BATHS IN NEED OF REMODELING. 3 BEDS 1 BATH ON FIRST FLOOR. 2ND FLOOR IS LARGE OPEN SPACE. ZONED FOR 2-3 UNITS. DETACHED NEWER 2 CAR GARAGE.

3009 2ND ST

asking price: $1,550,000

3 Bedrooms, 2.50 Bathrooms

THIS IS ONE OF THE LAST LOTS OF ITS KIND IN THE BEST SANTA MONICA LOCATION. TURN OF THE CENTURY HOME AND GUEST HOUSE JUST SECONDS TO MAIN STREET AND OCEAN PARK. SUN PORCH ENTRY, BRIGHT CHARM FILLED INTERIORS WITH ORIGINAL FIR FLOORS AND VINTAGE MOLDINGS. COOK’S KITCHEN WITH SERVICE PORCH, SECLUDED FRONT AND BACK YARDS. GUEST UNIT 1+1. TOTAL PRIVACY FROM MAIN HOUSE.

37 SEA COLONY DR

asking price: $1,795,000

2 Bedrooms, 2.50 Bathrooms

TURNKEY OCEAN VIEW TOWNHOUSE AT THE EXCLUSIVE 24 HOUR GUARD GATED SEA COLONY I AND JUST STEPS FROM THE BEACH. FEATURING HARDWOOD FLOORS THROUGHOUT. ALSO OFFERED FOR LEASE AT $6,850 PER MONTH.

2623 5TH ST

asking price: $1,999,000

4 Bedrooms, 5.00 Bathrooms

AMAZING OPPORTUNITY TO BUY THIS UNIQUE LOT W/ PLANS & PERMITS READY TO BE PULLED TO BUILD A MODERN STYLE HOME APPROXIMATELY 6000 SQ FEET, COST OF CONSTRUCTION $1.5M PLUS $230K FOR POOL.18 MONTHS CONSTRUCTION SCHEDULE. PERMIT IS READY AND MUST BE PULLED BY APRIL 14, 2013. DEMO MUST START OCT 14.

Do let us know how we can move forward together in meeting your real estate goals 310.392.1211 or jodi@jodisummers.com.

Best….

Jodi Summers

The SoCal Investment Real Estate Group

Sotheby’s International Realty

310.392.1211

jodi@jodisummers.com

www.SantaMonicaPropertyBlog.com

Things do not change, we change. – Henry David Thoreau

p.s. a. This is not intended as a solicitation if your property is already listed with another agent.

b. We are not the listing agent on this property.

Should you wish to unsubscribe from this emailing, please hit the reply button, and write unsubscribe in the headline of the email.
Sotheby’s International Realty, Inc. is Owned and Operated by NRT Incorporated.

http://pro.themls.com/membersonly/All_Searches/prospects_frame3.cfm?theButton=run_prospect_total&search_num=67138765-6543-45bd-8256-bf73017e9e53&update_type=All_Changes

http://www.santamonicapropertyblog.com/?p=4823

SOCAL MULTIFAMILY REAL ESTATE SNAPSHOT – MARCH 2013 ~ STURDY DEMAND

February 27, 2013 on 8:44 pm | In Buyers, Charts + Statistics, Economy, Investment Opportunities, Market Snapshot, Rents, Sellers, Trends, Uncategorized | No Comments

by Jodi Summers

Los Angeles apartment property buyers rejoice. The pundits predict that the Los Angeles metro area multifamily market will continue to record steady economic growth through major construction projects, a rebound in tourism and continued expansion in the entertainment industry.

If you already own, rental returns are satisfying. Apartment rents in Los Angeles rose 6.2% last year, according to the USC Lusk Institute. Tight leasing conditions will push rent growth up 4.1% in 2013 and 5.1% in 2014. The average rent will advance from $2,172 per month in 12-12 to 2012 to $2,376 per month by December of 2014.

With that kind of return on investment, apartment properties are still in strong demand in Los Angeles.

“…Investors are moving beyond core properties and driving up pricing at the lower end of the market,” observes Dr. Ruijue Peng, author of the CoStar Commercial Repeat Sale Indices.

The idea of investing in multifamily properties is popular. Have you noticed all of the new construction around town? A large pipeline of new apartment product will enter lease-up in 2013 and 2014. Overall, developers added 1,670 units in 2012, but that was baby growth. West Los Angeles inventory will increase by 3,000 units by the end of this, with significant development occurring in the Santa Monica, Hollywood, Brentwood/Westwood and Airport Cities submarkets. Completions will tick down to 2,600 units in 2014.

Net move-ins of 2,560 units is anticipated for 2013 and net absorption of 2,610 apartments is forecast for 2014. Solid leasing trends in 4Q 2012 resulted in 480 newly occupied units, boosting 2012 absorption to 2,100 units, the highest number of net move-ins since 2004. 2011 saw 1,275 units absorbed into the marketplace.

Robust development activity will make life easier on local planning departments. Annual multifamily permit issuance will slip to approximately 2,600 units in 2013…but leap to 4,675 multifamily units during the following year.

Sturdy rental demand will mitigate the effects of new apartment supply. Average vacancy rates may rise slightly this year to 4.2%, but will drop back to 4.0% in 2014.

The strength of the multiunit market place has pushed the median sold price of apartment properties in Los Angeles up 25% when comparing 1-11 with 1-13, according to Clarus Market Metrics. Meantime, the number of Under Contract properties is up 31%. Desire is up, get yours while there are good options to be had.

We’re here to help you with your property needs. Please contact Jodi Summers and the SoCal Investment Real Estate Group @ Sotheby’s International Realty – jodi@jodisummers.com or 310.392.1211, and let us move forward together.

http://www.costar.com/News/Article/Apartment-Rent-Growth-Expected-To-Decelerate-In-Top-Markets-Ahead-of-New-Supply-Wave/145859

https://www.terradatum.com/cmm/claw

http://www.socalmultiunitrealestateblog.com/?p=2357

http://thevacationgals.com/wp-content/uploads/2010/04/family-fun-on-a-Los-Angeles-vacation.png

http://www.costar.com/News/Article/CRE-Sales-Surge-In-2012-As-Pricing-Recovery-Spreads-To-More-Markets/145720?ref=100&iid=323&cid=383F14EEE265B182474DA2442BACBBBF

http://www.usc.edu/schools/price/lusk/casden/pdfs/multifamily-report-2012.pdf

http://www.apartmentupdate.com/index.cfm?fuseaction=markets.main&mktpage=861&login=1

SOCAL MULTIUNIT REAL ESTATE SNAPSHOT – FEBRUARY 2013 > MANY NEW RENTERS NEED UNITS

January 30, 2013 on 11:18 pm | In Charts + Statistics, Fascinating Information, Market Snapshot, Rents, Sellers, Trends, Uncategorized | 1 Comment

by Jodi Summers

Woooo….talk about a great recession, the nation’s homeownership rate has dropped to its lowest in 50 years > estimated at 62.1% …but here’s the rub…Beginning in the 1990s, the pace of rental housing construction fell behind the 350,000 units needed to maintain balance in the market. This situation was exacerbated during the Great Recession, when a mere 100,000 to 170,000 new units were constructed annually. Lots of renters, not enough units.

Now that the economy is coming back, builders are catching up to demand. The new construction boom saw almost 230,000 new multifamily units built in 2012. Of the top 180 metros in the country, 44 doubled the amount of multifamily construction in 2012, according to a study by John Burns Real Estate Consulting.

In Los Angeles, the lack of apartment properties is pushing cap rates down and prices up. Contrasting Dec-2010 with Dec-2012 the median price of sold properties is up 38%, according to Clarus Market Metrics.

Vacancy rates are not an issue these days, as U.S. apartment vacancies declined to an 11-year low, as per Reis Inc. (REIS). The national vacancy rate has dropped to 4.5% from 5.2% a year earlier. Vacancy rates are at their lowest level since 3Q 2001, when the rate was 3.9%. New York was the tightest market, with a 2.1% vacancy rate. The Los Angeles vacancy rate was 4%, as per the L.A. Housing Department.

Foreclosures and the economy has elevated the number of occupied since 2Q 2009, as millions of people forced out of their houses by foreclosure became renters. Additionally, stricter mortgage requirements have made it harder for potential homebuyers to obtain loans.

The multifamily market in Los Angeles may be at its most constrained. The number of for sale properties is down -51% from two years ago. Capital is available to ease purchasing.

One of the big reasons for the growth, according to Lesley Deutch of John Burns Real Estate Consulting, “is that banks are starting to loan again to multifamily. There is a lot of private equity out there because lenders realize how strong the sector is.”

Money is flowing, and eventually our market will ease. Multiunit starts are up 27% from last year, according to the National Association of Home Builders. Despite all the construction, “rents are still going up,” which is a positive signal for lenders, observes Deutch.

Multifamily market demand is expected to remain strong during the next couple of years due to favorable demographics among prime renters and a decreasing national homeownership rate. A Freddie Mac forecast report predicts call for 1.7 million new renter households to come on the market between now and 2015.

While investors are breathing a sigh of relief as the real estate market shows signs of major improvement, the higher rents and low vacancy have made some renters’ searches for affordable apartments more challenging. Potential renters are advised to have plenty of cash at hand, a solid credit history, and a clean background check.

Demographic trends indicate that the preference for apartment renting crosses over multiple generations, from Baby Boomers looking to downsize to Generation Z, the youngest renters in the marketplace. But both groups share the desire for lifestyle convenience when selecting an apartment, including easy access to transportation and safe, walkable neighborhoods.

We’re here to help you with your commercial and investment property needs. Please contact Jodi Summers and the SoCal Investment Real Estate Group @ Sotheby’s International Realty – jodi@jodisummers.com or 310.392.1211, and let us move forward together.