Income Property Services, Walnut Creek, California. Complete commerical real esate and investment services.
Income Property Services offers services above and beyond that of typical brokerage firms and strive to include changing technology and industry innovations to better serve our clients.
INVESTMENT PROPERTY INSIDER
Optimism or “Gloom & Doom”?
lf you ask a property owner, manager, or broker “how's the market?” you're likely to get conflicting responses, leaving you confused. And it's no wonder.
We've seen a mix of both good news and bad news. On one hand there are many markets that have lost significant value in just a few years with rents that continue to fall. But in spite of the bad news, other parts of the Bay Area have remained fairly stable and are actually increasing value. Some owners have reported lower vacancies as well as more tenant traffic. And some commercial tenants have gobbled up large spaces left by those unable to make it in this new economy.
Finding consistent rent and sale comparables has never been more challenging, baffling even the real estate professionals. How is today's investor to interpret such diversity?
Our observation is that there seems to be a wave of good economic news (and thus, healthier real estate conditions) moving from San Francisco and the Peninsula eastward. Clients and colleagues have indicated strength in the market in nearly all product types west of the Bay Bridge. One client received multiple phone calls from his multi-family rental in San Francisco shortly after bringing it to market.
The number of sale transactions, however, is still far below recent year's activity. In the East Bay, several owners, managers, and brokers we know have agreed that the “A” and “B” locations are also showing signs of strength in many product types with lower vacancies, increasing rents, and more tenant traffic. “C” and “D” locations are not faring as well and foreclosure activity is still high in these areas
Continuing east to Contra Costa County, the news is mixed: more affluent cities seem to be weathering the economic storm better than those areas with high foreclosure rates (such as Eastern Contra Costa). Green shoots seem to be appearing in the strong markets of Central Contra Costa and we can only hope that as the foreclosure cycle is completed, the markets will strengthen.
Why consider buying investment property now?
- Probable “bottom” of the market
- Little competition for most properties
- Interest rates still at or near historical lows, with fixed rates available
- Long term outlook is strong with so little new construction
Why consider selling investment property now?
- Interest rates have helped hold values up - low rates may or may not last
- Less quality investment real estate currently on market = less competition
- Still some economic uncertainty in the next three to five years
It's refreshing to see the enthusiasm of so many of our recent clients. They realize that real estate can be an excellent long term investment with benefits not found anywhere else. The ability to add value, take advantage of tax benefits, own a tangible asset, and take advantage of appreciation appeals to them. Most of our recent sellers have owned their properties for a long period of time, and have experienced these benefits.
We believe the investment real estate market is slowly improving and are cautiousty optimistic for continued strength through 2011. We welcome the opportunity to discuss how we may add value to your real estate investment.
At Income Property Services, we help investors evaluate their property to maximize their investments in the current market. We invite you to contact us for a free, no obligation consultation.
Another IPS Case Study
“The $375,000 phone call”
A client recently contacted us to ask our opinion about a couple of unsolicited offers he had received on his 8-unit apartment complex. The first offer was for $1,100,000 and offered a quick closing with what seemed to be a qualified Buyer....