Falling interest rates from the COVID-19 fallout mean many Multifamily owners are refinancing and acquiring fixed-rate debt. Mortgage rates have dropped below 3%, for example, their lowest level in nearly 50 years
In addition, the housing shortage in many cities, like San Francisco, will keep demand high despite the economic ramifications of the Coronavirus
URL: https://www.bisnow.com/south-florida/news/capital-markets/coronavirus-mortgage-rates-103355
Marcus & Millichap Special Report: Coronavirus Outbreak
Thank You Ramon Kochavi for sharing this informative report
Real Estate is not isolated from broader market trends, but it is substantially less volatile than the stock market, with average yields still between 5%-7%
The inevitable lowering of interest rates will also spur acquisition and re-financing, further ameliorating the affects the COVID-19 on the real estate market
From CoStar: "San Francisco Ranked as Best US City for Jobs, Led by Technology Industry"
San Francisco is now the #1 city for jobs in the United States
After being stuck at the number 4 spot for three years, SF took the gold because of wage growth and it's robust high-technology sector
“Overall, metros with strong tech industries remain the superstars of regional economies,” the report said. “One key factor in the success of these tech powerhouses is their ability to engage in new technologies.”
URL: https://product.costar.com/home/news/1520896123?market=35
When people leave California, where do they go?
When people leave hashtag California, where do they go?
Phoenix, Arizona it turns out. The city had a net inflow of 6,509 in Q4 2019 compared to 5,254 in Q4 2018, making it the #1 most popular moving destination in the United States
Not incidentally, Phoenix also experienced one of the largest rent increases of 2019 at 8.3%
Portland, Oregon also claimed #7 on the top ten list of moving destinations, which also saw rent growth in 2019 of 4.5%
Interestingly, the largest origin points for both cities are LosAngeles and SanFrancisco, respectively
It seems that the North vs. South divide in California extends to moving as well
https://www.housingwire.com/articles/everybody-loves-phoenix-popular-metros-to-move-to/
From Curbed: "Here’s how California’s rent control law works"
An important and informative piece from Curbed explaining how California Assembly Bill 1482 will affect Apartment homeowners:
The largest change is that there is now a cap on how high property owners can raise their rents each year, specifically 5% + local inflation.
This law, however, will not affect buildings built in the last 15 years. Unless, of course, your city already have local rent control ordinances (like San Francisco or Berkeley, for example).
In addition to the above, the law will require that any eviction must have a provable “just cause”, and that any tenant resident for more than one year must be given the opportunity to “cure” the violation.
(https://la.curbed.com/2019/9/24/20868937/california-rent-control-law-bill-governor)
Rental Marketing Platforms
Rents in San Francisco are down. There are fewer renters at open houses and units are staying unrented for longer. Some estimate rents are 10% or more off their peak meaning if a landlord achieved $3,200/month in rent for a one bedroom, they are now around $2,900. Not all landlords are approaching this the same way and I believe it’s helping the more creative ones to achieve top of the market rents. One area landlords focus on is their advertising platforms, or where to advertise a unit. Craigslist is the standard. As Dave Chesnosky, Director of Leasing for RentSFNow, puts it “Surprisingly still in 2017 Craigslist brings in great leads that convert more leases than other sites”. However, some top rental candidates are looking on multiple sites. Dave and other industry leaders are on different platforms to make sure they get those candidates too. Joanne Fazzino, the top leasing agent at J.Wavro, prefers Zillow and Trulia (now owned by Zillow). Zillow’s Rental Manager site (https://www.zillow.com/rental-manager/) is easy to navigate with a simple photo uploader. Advertising on Zillow is fairly easy and getting a unit up on their site is free. Haley Crawford, Director of leasing for Brick & Timber, has good success with Hotpads. Hotpads (https://hotpads.com/) is very easy to register, no password is required. One of the benefits for Hotpads is how easy it is to use on the iPhone. Vicki Ernst, director of management for W Property management, uses apartments.com (https://www.apartments.com/add-edit-listing/). Their phrase “one step. Millions of renters” is very true and its free. In summary, the rents in San Francisco are off their historic highs, but great renters are still out there if landlords are willing to branch out to beyond Craigslist.
1813-1817 15th Street Just Listed
1813-1817 15th Street
5 units / 3 car parking
List Price: $2,900,000
*Fully vacant property
*Central Mission Dolores Location
*5 units / 3 car parking
*Site permits for ADU & Roof Deck
Download the Offering Memorandum Here
Call or email for more details
Exclusively Listed by:
Joe Levy
Tel: (415) 625-2168
Fax: (415) 963-3010
joseph.levy@marcusmillichap.com
License CA: 01932439
Clinton Textor
Tel: (415) 625-2157
Fax: (415) 963-3010
clinton.textor@marcusmillichap.com
License CA: 01318639
Mid-Year Report
Mid Year Sales Report:
Joe's Half Year Sales Trends Report
"Must Reads":
1) Challenges facing millennials buying houses
2) At $40 million, this is the most expensive home sale in San Francisco