The numbers appear to be encouraging for owners of multi-family investment properties. You may be asking yourself Am I getting the most out of my multi-family investment property?
With Southern California area rents up as much as 18% (12.8% for LA County, 17.4% Inland Empire, and a whopping 18.2% for Orange County) many investors are wondering how long this can be sustainable. Then, when we look at the low vacancy rates of 3.1% for LA County and 2.4% for Orange County and the Inland Empire, it may feel like the latter stages of a game of musical chairs. Should we just hang on or be looking for a possible “landing”?
Maybe ask yourself a few questions:
WHAT IS MY LONG-TERM STRATEGY?
When I purchased my current properties, was I planning to expand, add more units to my portfolio, and keep moving? Was I planning to just own one property and keep it forever- pass it down to my heirs?
AM I CONCERNED ABOUT RENT CONTROL?
Statewide rent control has affected multi-family owners, especially those who had rents well below market rents. In many cases, it could take many years of annual raises to meet the current market rate, but how will they ever get to the future market rate? What about the moratoriums on evictions in some cities?
HAVE THERE BEEN LIFE CHANGES AFFECTING MY FUTURE STRATEGY?
Has my employment situation changed? How is my health? Are family members depending more on me than before? Are there any new unexpected expenses?
It’s always good to check with your CPA and your real estate attorney before making a major move, but at the end of the day, only you can answer these questions.
What we at PRS PROPERTIES CAN DO. We can discuss with you the current rents in your area and supply you with comparable rental prices for similar properties. Before you hire a manager, make sure the compensation is fair to you! We can also look at your building for changes that might allow you to get a higher value in order to create value without huge expenses for your building. We can help you to get the maximum value for your property, should you decide to sell, or the maximum return if you are planning to keep your building.
We always have many investors who are looking for “as-is” properties and are willing to purchase with low rents, a moratorium, or even with a problem tenant in place. We have put together numerous transactions over the years which involve properties that are not listed for sale. Many investors are in 1031 exchanges and need to identify a replacement property before their 45-day identification period runs out.
Should you decide to put your property on the market, we will put together an aggressive, targeted, and professional campaign to get your property sold fast. We have been doing this for over 40 years, and we will use all the tools available to bring you the most dollars at closing. If you are thinking of selling or are just curious about the value of your property, don’t hesitate to give us a call.
Remember – KNOWLEDGE IS POWER!
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