Socal Multiunit Real Estate

SOCAL MULTIUNIT REAL ESTATE SNAPSHOT – SEPTEMBER 2010

By Jodi Summers

This month, we’ll look at the big picture for multiunit properties – SMILE *< : ) - it’s all good. Apartment properties should continue to be a bright spot in your real estate investment portfolio for years to come. President George Bush’s tax cuts are set to expire on December 31, 2010. New Year’s Day, capital gains taxes will revert to 20% from their 70-year low of 15%. (To add insult to injury, the tax rate on dividends for top earners will jump from 15.0% to 39.6%, barring a slight of pen from Secretary of the Treasury Tim Geithner.) If history repeats itself, and a déjà vu of 1986 - when significant tax code revisions took effect and the capital gains rate increased from 20% to 28% - investor liquidations are likely to double the total realized capital gains from the previous year.

The current state of the apartment market offers more good news. Demand for apartments has moved well beyond employment gains with the absorption of nearly 46,000 units nationally during the second quarter -> the strongest gain since 4Q 2000. This aggressive lease-up of apartments resulted in a vacancy drop to 7.8%, a trend that should continue through year-end. Unless there is “a systemic shock that halts job creation,” the California Employment Development Department predicts that an additional 65,000 units will be absorbed through the second half of the year, dropping vacancies to 7.4% nationwide by year-end.

Multiunit investments are going to start looking really good. Since 2002 - the year before the capital gains tax rate was reduced to a 70-plus-year low - the number of 1031 exchanges has fallen by nearly half. As capital gains taxes rise, the volume of 1031 exchanges is expected to increase substantially, as sellers will be note be motivated to take profits from the investment real estate sector.

The future is bright. Expect the multiunit market to heat up. Regardless of the decline in investment values, many investors will adopt a liquidation strategy, locking in their profits rather than waiting for investments to appreciate sufficiently to offset the 5% tax hike.

Experts say perceived tax-related risks may encourage them to continue selling assets in 2011.

We’re here to help you with industrial properties. Please contact Jodi Summers - jodi@jodisummers.com or 310.392.1211, and let us move forward together.

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http://www.edd.ca.gov/About_EDD/pdf/urate201010.pdf

http://www.labormarketinfo.edd.ca.gov/?pageid=1003

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THE GOVERNMENT HAS $72 BILLION FOR GREEN REAL ESTATE

By Jodi Summers

Experts have calculated that the Obama administration has put together more than 30 programs worth $72 billion that can be used to increase energy efficiency in commercial buildings and multifamily housing.

“The Obama Administration has tremendous, untapped opportunities to use legal tools already at its disposal to enhance the energy efficiency and sustainability of the nation’s multifamily and commercial buildings — all without seeking new funds or authority from Congress,” observes a report prepared by Van Ness Feldman. “All told, the programs identified in this report have the potential to directly provide or facilitate over $72 billion in funding or loan guarantees, and can leverage hundreds of billions of dollars in private investment through instruments such as mortgage insurance and regulation of the real estate lending market.”

Titled “Using Executive Authority to Achieve Greener Buildings: A Guide for Policymakers to Enhance Sustainability and Efficiency in Multifamily Housing and Commercial Buildings,” the legal analysis, suggests several ways the Obama administration can use existing programs to enhance building efficiency:

* Reforming appraisal and underwriting practices at Fannie Mae and Freddie Mac Greening federal banking regulations

* Promoting flexible FHA insurance products

* Integrating energy efficiency and sustainability criteria into competitive grants and funding formulas

* Strengthening minimum property standards for federal housing and economic development programs to reflect energy efficiency and sustainability standards

* Improving performance standards applicable to federal buildings and leases

* Refining guidance applicable to the energy efficient commercial buildings tax deduction and the national historic preservation tax credit

* Using SBA funding mechanisms to support small business energy efficiency investments

* Streamlining Title 17 loan guarantees to make them suitable for buildings

“As an early adopter of green buildings and the LEED green building certification system, the federal government has been a leader in bringing green buildings to cities and towns across America,” said Roger Platt, the USGBC’s senior vice president of Global Policy & Law declared. “This new report unveils an even larger opportunity for the Obama Administration to increase our nation’s energy efficiency, while creating thousands of jobs and saving taxpayers money.”

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http://www.usgbc.org/government

http://www.greenbiz.com/news/2010/04/30/obama-already-has-72b-tap-green-buildings-study-says

http://www.boulderindependentbusiness.org/wordpress/wp-content/uploads/2009/02/namaste_obama_0093.jpg

http://www.rechargenews.com/multimedia/archive/00032/obama_solar_3_32125a.jpg

LOS ANGELES IS AWARDED $30 MILLION FOR RETROFITTING REAL ESTATE

By Jodi Summers

All the banter that Los Angeles mayor, Antonio Villiarigosa has been causing in Washington with his green / energy saving ideas for Los Angeles are paying off. Recently, Vice President Biden announced that Los Angeles County was awarded $30 million to “ramp-up” energy efficiency building retrofits.

Los Angeles was one of 25 communities selected to receive a slice of $452 million in Recovery Act funding under the Department of Energy’s Retrofit Ramp-Up Initiative. The initiative promotes the concept that communities, governments, private sector companies and non-profit organizations will work together on pioneering and innovative programs for concentrated and broad-based retrofit projects.

A simple example of how the Retrofit Ramp-Up Initiative would work would be to have the same construction crew upgrade all the homes on the same block at the same time. The White House notes that this way of doing business, “…Saves contractors time and money. They can pass the savings on to their customers. And it’s just a much more efficient way to operate.”

Biden said the program, part of $80 billion in the Recovery Act for a clean energy economy, will help consumers save money on their energy bills, lower greenhouse gas emissions and create green jobs.

The models created through this program are expected to save households and businesses about a $100 million annually in utility bills, while leveraging private sector resources, to create what funding recipients estimate at about 30,000 jobs across the country during the next three years.

“Investing in retrofits is a triple win,” Vice President Biden observed, adding the program will result in retrofits for hundreds of thousands of U.S. homes and businesses over the next three years.

“This initiative will help overcome the barriers to making energy efficiency easy and accessible to all – inconvenience, lack of information, and lack of financing,” said Energy Secretary Steven Chu. “Block by block, neighborhood by neighborhood, we will make our communities more energy efficient and help families save money. At the same time, we’ll create thousands of jobs and strengthen our economy.”

In addition to the $452 million Recovery Act investment, the 25 projects will leverage an estimated $2.8 billion from other sources over the next 3 years to retrofit hundreds of thousands of homes and businesses across the country. The government noted gleefully, that the program funding was eight times oversubscribed, with more than $3.5 billion in applications received for the just over $450 million in Recovery Act funds available, (kind of like applying for UCLA). That puts it in course for additional investment in energy-saving and job-creating projects like these nationwide.

Retrofit Ramp-Up Awards

The following governments and non-profit organizations have been selected for Retrofit Ramp-Up awards. These projects are planned to begin in fall 2010. Final award amounts are subject to negotiation:

Austin, Texas - $10 million

Boulder County, Colorado - $25 million

Camden, New Jersey - $5 million

Chicago Metropolitan Agency for Planning - $25 million

Greater Cincinnati Energy Alliance, Ohio - $17 million

Greensboro, North Carolina - $5 million

Indianapolis, Indiana - $10 million

Kansas City, Missouri - $20 million

Los Angeles County, California - $30 million

Lowell, Massachusetts - $5 million

State of Maine - $30 million

State of Maryland - $20 million

State of Michigan - $30 million

State of Missouri - $5 million

Omaha, Nebraska - $10 million

State of New Hampshire - $10 million

New York State Research and Development Authority - $40 million

Philadelphia, Pennsylvania - $25 million

Phoenix, Arizona - $25 million

Portland, Oregon - $20 million

San Antonio, Texas - $10 million

Seattle, Washington - $20 million

Southeast Energy Efficiency Alliance - $20 million

Toledo-Lucas County Port Authority, Ohio - $15 million

Wisconsin Energy Conservation Corporation - $20 million

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http://www.energy.gov/news/8870.htm

http://www.whitehouse.gov/the-press-office/vice-president-biden-kicks-five-days-earth-day-activities-with-announcement-major-n

http://content.usatoday.com/communities/greenhouse/post/2010/04/white-house-awards-452-million-to-retrofit-homes-businesses/1

http://www.inhabitat.com/wp-content/uploads/2010/02/Smart-Grid-Obama.jpg

SOCAL MULTIUNIT REAL ESTATE SNAPSHOT – JUNE 2010

by Jodi Summers

According to the California Department of Finance, on January 1, 2008 Los Angeles had a population of 10,363,800 residents. Statistics indicate that this is an increase of 844,500 persons since 2000. The County’s population would make it the eighth largest state in the nation, just behind Ohio and ahead of Michigan. Everyone needs a place to live – so if you think about it, multiunits are always a good investment in Los Angeles County.

Compare May-08 vs. May-10 in Los Angeles County, the median price of for sale properties is down 10% and the median price of sold properties is down 63%.

Smart investors know this the is bottom of the apartment market in the more desirable parts of
town. This theory is bolstered monthly by a variety of reports. The Case-Shiller Home Price
 Index notes a  very uneven housing market, with significant recovery in some places and
continued decline in others. Housing prices have held up better in wealthier and more
productive regions, with higher concentrations of knowledge, professional and creative work,
and high-tech industry as well as higher levels of amenity (measured as working artists and
cultural creatives) and openness (measured as greater percentages of immigrants). Sounds
a lot like Los Angeles, which is why the  Number of Under Contract Properties by Month is up
115% compared with two years ago.

Did you know that Los Angeles County has 112 public and private colleges and universities? Our higher learning institutions include UCLA, USC, California Institute of Technology, and the Claremont Colleges to top-rated specialized institutions, like the California Institute for the Arts, the Art Center College of Design, the Fashion Institute of Design and Merchandising, and the Otis College of Art. Medical education is also a strong point; Los Angeles has two each of medical schools, dental schools, and eye institutes, plus specialized research and treatment facilities like the City of Hope. The County’s community colleges offer many innovative programs, including culinary arts, fashion design, multimedia, and computer assisted design and manufacturing.

We sound like a smart group, and the strengthening of our real estate market confirms that Los Angeles would fall into the wealthier and more productive regions of our company. Actually, three California cities are in top six growing real estate markets, according to the Case-Shiller Home Price Index. San Francisco posted the largest gain — 16.2% over the past year. San Diego (10.8%), Cleveland (6.7%), Minneapolis (6.5%), L.A. (6%), and D.C. (5.6%) also posted significant gains.

The report notes that “Housing prices have fallen further in locations with lower incomes and wages to begin with, with blue-collar manufacturing economies, lower levels of skill, and lower levels of amenity and openness. Expect that pattern to continue.”

Savvy investors purchasing apartment properties over the past years have used a variety of
financing  methods to make up for the weakness in the commercial loan market. As the stock
market tanked,  many investors pulled money out and paid cash for multiunits, or worked out seller
carrybacks. Now  the Mortgage Bankers Association is saying commercial lending for multiunits
is coming back. The MBA’s Quarterly Survey of Commercial/Multifamily mortgage originations
states that 1Q 2010 commercial and multifamily mortgage loan originations were 12% higher than
during the same  period of 2009.  Sales are way up. Comparing May-08 vs. May-10 in Los
Angeles, the number of sold properties is up 72%

The National Association of Realtors confirms that the apartment market is strengthening. Chief economist Lawrence Yun noted that the only bright spot in commercial real estate is apartments. “Demand for units should increase in the second half of the year as new jobs are created in the improving economy and new households are formed,” he concluded.

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http://www.laedc.org/reports/LA%20County%20Profile.pdf

http://latimesblogs.latimes.com/money_co/2010/05/vacancy-rates-will-continue-to-rise-in-most-types-of-commercial-real-estate-such-as-office-and-industrial-buildings-until-the.html

http://www.theatlantic.com/national/archive/2010/05/housing-prices-and-the-great-reset/57287/

http://www.creativeclass.com/creative_class/_wordpress/wp-content/uploads/2010/05/YearOverYear.jpg

http://www.costar.com/News/Article.aspx?id=359D8A406145159176A40807B924DC84

https://www.terradatum.com/agentmetricsonline/report_chart_view.td

SOCAL MULTIUNIT REAL ESTATE SNAPSHOT – MAY 2010

By Jodi Summers

It’s been all over the news. Now is the time to buy multiunit properties. Today’s research, offered by Bank of America-Merrill Lynch, concludes that if the apartment market didn’t bottom out in the fourth quarter of 2009, then it did during the first three months of 2010. The L.A. County multiunit market is the most desirable it’s been all millinneum.

In Los Angeles County comparing April 2008 to April 2010, the median price of for sale properties is down 18% and the median price of sold properties is down 47%

The lack of commercial financing and higher vacancy rates have contributed to the huge drop in sales prices, Marcus & Millichap data shows that apartment-house prices have slipped to an estimated median of $128,500 a unit last year, down 4% from 2008.

And that’s why in L.A. County, the number of for sale properties is down 40% and the number of sold properties is up 82%. Those that don’t have to sell are not, and those that can buy are.

More encouraging reasons to buy a multiunit property? Axiometrics’ survey of some apartment managers in the top 20 national markets reported better rental revenues in the first quarter, as compared with the four preceding quarters. Overall occupancy ended the first quarter at 92.6% and effective rents were $1,106.33.

And that is why locally, the number of under contract properties is up 156%.

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http://netleaseinsider.blogspot.com/2010/04/us-apartment-uptick-net-lease-impact.html

http://www.globest.com/news/1644_1644/insider/184557-1.html

https://www.terradatum.com/agentmetricsonline/agentmetrics_online.td?__m_sid=121

LOS ANGELES MULTIUNIT REAL ESTATE SNAPSHOT – APRIL 2010

By Jodi Summers

Experts say the multiunit market is leading the commercial real estate recovery. After a dismal year of increased vacancies in the high end areas (There were 141 properties available for lease in Santa Monica on April 1^st, and 133 in Beverly Hills, according to the MLS.), which forced landlords to cut rents and make leasing concessions, investors have a renewed sense of optimism. Essentially, there’s no place to go but up. Nationally, average vacancy rate sits at a historic high, hitting 8% at year-end 2009. This positive outlook is confirmed by a PricewaterhouseCoopers Korpacz Real Estate Investor Survey for the first quarter of 2010, titled, “Investor Sentiment Improves, But Challenges Persist in 2010″ notes the multifamily market, will “bump along the bottom” this year, but continued price drops are not in the forecast.

Similar to other property sectors, sales activity has diminished for apartments; conversely demand is high for well-located, high-quality assets. Los Angeles is reaping those benefits. In Los Angeles County, comparing March 2008 to March 2010 the number of properties under contract is up 188%…

While the average number of sold properties is up 88%.

Another positive sign, the average days on market is down 16%. Nationally, the average asset sold within 8.06 months this quarter, a 9.03% drop from the prior quarter.

The market surge may be attributed to the fact that nationally, cap rates for apartments fell over the final three months of last year, ranging from 5% to 11%, with an average of 7.85%, down from 8.03% in the third quarter of 2009. For the first quarter of 2010, cap rates have risen back up to 8.01%. Cap rates for properties that are selling tend to be in the 5%-7.5% range in L.A. County, again depending upon the neighborhood.

Investors are always happy to pick up what they perceive as a value in California. But, on a regional level, in less sexy areas, the performance of the apartment market has hinged on the performance of the individual markets’ employment scene. Take the very solid Washington, DC, market, for example. Jobs are on the rise, and vacancy rates have remained stable over the past six months. This success can be applied throughout the Mid-Atlantic region as well. Face it, real estate tends to be stronger on the coasts.

Another happy point, investors feel that multifamily market rents should grow by a national average of 2.41% over the next eight years…or the standard 4% a year in Los Angeles.

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http://www.globest.com/news/1624_1624/insider/184102-1.html

https://www.terradatum.com/agentmetricsonline/agentmetrics_online.td?__m_sid=121

http://pro.themls.com

http://www.loopnet.com/xNet/MainSite/Listing/Profile/Profile.aspx?LID=16322406&SRID=826306030&StepID=101

http://c.imagehost.org/0479/cp5_Kennedy-Warren_Apartment_Building1.jpg

State of the Commercial Loan Market

By Robert Schroell

The rough ride isn’t over the for the commercial loan market.

Community banks in particular will likely have a tough time in 2010. Hundreds of regional institutions have a significant chunk of their loan portfolios ― up to and exceeding a quarter in some places ― in commercial mortgages.

At the same time, commercial debt is coming due at a staggering rate. The market will need about $1 trillion to service more than $3 trillion in commercial mortgage debt, according to a recent forecast by Keefe, Bruyette & Woods, a well-known New York analyst.

That’s likely to make cash a disappearing commodity, primarily for the banking industry. In fact, experts at Keefe, Bruyette & Woods are urging banks to consider offering extensions to cash-strapped homeowners, many of whom have struggled to refinance their existing mortgages.

A significant slew of delinquencies in CMBS (commercial mortgage-backed securities) and bank loans is also expected to shape the course of 2010. It’s also almost difficult to imagine CMBS delinquencies getting any worse ― the rate skyrocketed an astounding 500 percent last year, jumping past 6 percent in December 2009 for the first time ever.

The governor of the Federal Reserve Board recently tried to rally optimism, noting that recovery should begin to take root as the year progresses. But those rosy projections didn’t include the commercial real estate market, which continues to flounder amid strained credit conditions and stagnant refinancing.

All in all, it’s a less than inspiring picture of what’s likely on the horizon.

“We estimate that the weighted average price decline for the commercial mortgage market is roughly 25%,” the experts at KBW state in their analysis. “This suggests that almost all the equity in the commercial sector has been wiped out.”

Fortunately… there’s pretty much no place else to go but up.

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http://www.mortgageloanplace.com/commercial-mortgage.html

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LOS ANGELES 2010 - MULTIUNIT REAL ESTATE PREDICTIONS

Edited by Jodi Summers

The sun is shining again in Los Angeles. After two years of job cuts, payrolls are predicted to expand payrolls minimally in Los Angeles County in 2010, according to the 2010 National Apartment Index Report by Marcus & Millichap.

Los Angeles moves up two places this year to No. 13, thanks to perceived strengths in our marketplace. The hot spot is our sister city, San Diego, which rose four spots to No. 2 on the index due to expectations for resumed employment and household growth. (Washington, D.C., retained the top spot in the NAI for the second consecutive year, as ongoing government spending will fuel metrowide hiring and apartment demand.) New York City, which is the tightest apartment market in the country, finished in the No 3 spot.

Following are some of the most significant aspects of the Los Angeles Apartment Research Report:

* The local employment market is expected to stabilize in the second half. Following a loss of 115,000 jobs in 2009, payrolls are forecast to expand by 0.3 percent this year, with the addition of 13,000 positions.

* Rental completions will slow to 1,550 units in 2010, a 0.2 percent addition to inventory. Approximately 800 apartments are expected to come online in the San Fernando Valley due to continued job losses in the retail and construction sectors.

* Vacancy is forecast to tick up 20 basis points this year to 6 percent in response to ongoing stock additions.

* Lingering high unemployment will continue to pressure owners to lower rents. Asking rents are expected to fall to $1,335 per month in 2010, while effective rents will slip to $1,263 per month, respective declines of 2.8 percent and 3.6 percent annually.

Investors realize the current value of the Los Angeles, and there is a trend of cash-rich buyers shifting money out of the stock market and buying multiunit property with the intent of holding it for future generations.

“After watching the Los Angeles apartment market for years I have decided to move monies out of my stock portfolio and buy apartment buildings for my children,” noted one savvy investor.

A bolster for the multiunit market place is that Government-Sponsored Enterprise financing will remain available due to the GSE’s ongoing commitment to the asset class. (GSEs hold or pool approximately $5 trillion worth of mortgages.)

In conclusion, Marcus & Millichap expects, “Long-term rates to remain low this year, mortgage rates to stay relatively stable and lenders increasingly opting to work out extensions or modifications for loans rather than taking near-term losses. Seller financing, or assumable debt, will also become a big factor in transactions this year.”

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http://www.marcusmillichap.com/aboutus/News/Current/020510_los_mm.asp

http://www.globest.com/news/1580_1580/insider/183133-1.html

http://www.uli-la.org/node/382

http://en.wikipedia.org/wiki/Government-sponsored_enterprise#See_also

U2 CAN BUY COMMERCIAL PROPERTIES @ AUCTION

U2 CAN BUY COMMERCIAL PROPERTIES @ AUCTION

By Jodi Summers

Going, going, gone…with the commercial loan market in such a pathetic state, auctions are the fastest way for banks to unload undesired commercial property assets.

“Sellers are coming to the realization that the price point they had in mind is not a reality. That’s where auctions are so useful in determining value — bringing people together through competitive bidding,“ observed National Auctioneer Association spokesman Chris Longly. “Our membership is seeing more energy and movement this year on the commercial real estate side.“

The National Association of Auctioneers estimates that $58.6 billion in real estate was sold in private live-auction bidding in the U.S. in 2008, up 38.5% from five years ago. Auctions in residential real estate have risen 47.7%, raw land (including agriculture) 36.8%. Commercial real estate is up 31.3%, to $15.5 billion in gross auction sales for 2008. Last year, banks were dealing with residential real estate issues, now, banks are confronting commercial property asset issues.

While the foreclosure moratorium was on in residential, banks were able to reassess their commercial assets. You’ll note that auction activity growing in the 2^nd half of 2009, with major online commercial auction events. In the second half of July, NAI Global offered 75 investment properties in 21 states valued at more than $250 million. The timed online auction will include 58 properties — including the historic State Theatre in South Bend, IN, which still bears bullet holes from the nearby shootout following John Dillinger’s final bank robbery on June 30, 1934 — and 14 other properties. In late July, Sperry Van Ness/Guardian held an auction at the Hyatt Regency in Los Angeles includes more than $100 million in real-estate owned (REO), bank-ordered and developer close-out assets in six Western states.

Among the high profile properties going up for sale is the historic Watergate Hotel made infamous during President Nixon’s wiretapping antics. (http://www.socalofficerealestateblog.com/?p=669). Other noteworthy pieces of real estate hitting the auction market include development sites in the metro Washington, DC area, retail sites in Highland Park, IL, and Spokane, WA, the historic theater redevelopment in South Bend, IN, and an infill site in Flint, MI; an upscale hotel/golf resort in Beecher, WI, and a fully entitled multifamily development tract in Navarre Beach, FL, plus lots of excess and partially developed inventory.

Even the government is getting into it. As you know, the state has been selling off their legacy assets - http://www.santamonicapropertyblog.com/?p=1188, and take a cursory glance @ what the U.S. government might be auctioning off in California, and we find industrial properties in Laguna Nigel, Morro Bay and Red Bluff.

“We’re probably seeing a 30 to 40% increase this year” in office, retail, industrial, multifamily and land auction inquiries, remarked Paul Rogers, senior vice president @ Inland Real Estate Auctions, Inc. “With bank activity in particular, we’re going to be busy for the rest of this year — and probably well into next year.”

This trend echoes the real estate slump of the 1990s and early 2000s, with commercial properties following residential foreclosure auctions after they have been mainstays in the downturn. Companies auctioning properties note that it is an opportunity to sell assets quickly, reduce holding costs, and secure true market value under unpredictable market conditions.

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Sources:

http://www.costar.com/News/Article.aspx?id=F9243DEB83153259F95525F184C9EEE8&ref=100&iid=140&cid=383F14EEE265B182474DA2442BACBBBF

http://fasrp.sc.egov.usda.gov/fasrp/mainAction.do;jsessionid=804CCE54F02BBCC115D4B0BA22A910FF?pageAction=GetCounties&state=CA&stateName=California

http://www.philly.com/inquirer/world_us/20090720_Watergate_auction_drawing_interest.html

http://www.socalofficerealestateblog.com/?p=669

http://media.commercialappeal.com/mca/content/img/photos/2009/04/16/b17auction.jpeg

http://ethicalforeclosurefortunes.com/wp-content/themes/thesis/rotator/govt_auctions_sm.jpg

http://i.ehow.com/images/GlobalPhoto/Articles/5117276/237446-main_Full.jpg

http://www.unitedcountry.com/picturesx/10086-10099-1576957.jpg

http://www.ritholtz.com/blog/wp-content/uploads/2009/06/foreclosures-may-o9.png

http://www.mccallauctions.com/auctions/photos/1074/p12368596779029.jpg

IT’S A BIG-TIME BUYER’S MARKET FOR SANTA MONICA MULTIUNIT REAL ESTATE

IT’S A BIG-TIME BUYER’S MARKET FOR SANTA MONICA MULTIUNIT REAL ESTATE

by Jodi Summers

If you’ve been thinking about buying multiunits in Santa Monica, now is the time. It is a buyer’s market and there are great deals to be had.

Check out this two-year market snapshot showing the trends of Supply vs. Demand chart for residential income properties in Santa Monica. Notice that the number of multiunit properties for sale has dropped by 6% - there are now 58 multiunit properties on the market, while sales remain flat – three multiunit buildings sold in Santa Monica in September.

The government, in the form of Fannie Mae and Freddie Mac, now hold $194.62 billion of mortgages, all of which are backed by multifamily or healthcare properties, and mortgage pools guaranteed by the two hold another $157.25 billion of loans, for a total of $351.87 billion of mortgages.

When you add the mortgages held by federal, state and local governments to the agencies’ total, the volume of loans held by governments and their agencies balloons to $517.3 billion, a full 15% of the entire commercial mortgage universe. Scary thoughts for Halloween month.

Has your real estate market stabilized? Email jodi@jodisummers.com to receive a free market report for your LA county neighborhood.

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http://www.clarusresource.com/