Jeannie Niles Real Estate Investment
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March 2009 Multi-Family Report
PALM DESERT,CATHEDRAL CITY, DESERT HOT SPRINGS, COACHELLA VALLEY
A total of nine multi-family properties went into escrow in March, 2009.
| City | Type | # of Properties |
|---|---|---|
| Desert Hot Springs | REO | 7 |
| Cathedral City | REO | 2 |
| IN ESCROW | Asking Price | Age | |
|---|---|---|---|
| 68630 Cedar | CC | 139,000 | 2003 |
| 32791 Navajo | CC | 151,900 | 1988 |
| 66291 3rd St. | DHS | 26,900 | 1948 |
| 66320 Cahuilla | DHS | 29,900 | 1954 |
| 16102 Via Montana | DHS | 29,900 | 1959 |
| 66236 5th St. | DHS | 41,400 | 1948 |
| 13575 Ocotillo | DHS | 54,000 | 1983 |
| 66680 Joseph Way | DHS | 63,900 | 1986 |
| 68175 Calle Azteca | DHS | 83,000 | 1985 |
ALL were duplexes. Market time ranged from 6 days to 192 days, the average being 72 days. The older, major fixers continue to dominate the REOs.
Multi-family REO properties are now becoming prevalent in the market place. Most multi-family properties (duplexes, triplexes, etc) were purchased with at least 25% down, thus owners still had equity in the initial phase of this economic downturn.
Values have fallen in most cases 50% or more, thus wiping out any equity the investors may have had. I believe many investors are opting to (or will) walk away from their property(s) since they see no potential for profit in the future. Banks have been unwilling to negotiate with investors….hopefully that will change.
A Loan Modification could become the new refinancing tool.
With the ten loan limit imposed by Fannie Mae and Freddie Mac, some investors feel they cannot obtain new loans under any circumstances, so the impact on their credit doesn’t matter.
https://www.efanniemae.com/sf/guides/ssg/annltrs/pdf/2009/0902.pdf
How long will prices stay low? No one really knows. So the question is: “should I buy now when prices and interest rates are at an all time low, or should I wait because they may get even lower?”. Certainly, for a buyer with cash and/or good credit, there hasn’t been an opportunity like this for many years. Income properties can be purchased that will create a fantastic cash flow.
When is the “Best Time to Buy Real Estate”?
‘WHEN NO ONE ELSE IS BUYING’
No one really knows how many bad loans the banks are holding, or what their balance sheets would show if there were “full transparency”. I have several sources advising that banks are holding 80% of their problem loans in order to keep their balance sheets propped up, just waiting for the government to come up with a solution. It seems obvious from all the rhetoric being bandied about, that such a solution will ultimately emerge.
I welcome all comments and questions.
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Income property has once again become “Income property”.
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There are many small income properties available in the area. Prices here have declined over 50% since the peak of the market late 2005/early 2007.
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It’s possible to obtain some great apartment financing. 25% down payment and interest rates at 6% or slightly below.
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Cap Rate is an investment tool for analysis that enables an investor to compare one investment to another.
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Cap Rate is the best tool for determining the value of an income property.
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Some of the most outrageous episodes in property ownership that the owners lived to tell about.
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Only 5% sales agents or brokers actually own investment property, and only 10% actually sell a property.
Every investor's situation is unique, and I have over 25 years experience solving problems. Use the form below to ask me about your unique needs.
Jeannie Niles Real Estate Investment
P.O. Box 317
Palm Desert, CA 92261
P: (760) 360-4020
F: (760) 340-9069
E: jniles@realestate-investment.com
