Yea… There’s Not Much To Choose From, But, Rents Are Up Too….
If you are curious about the market regarding Sacramento Duplexes for Sale, I’ve got some recent stats/graphs for you. We’re still in a Seller’s Market and I think you’ll see the graphs below make the point. I think they will also change a bit next month.
If you have ever read any of my past articles, I’ve always said “A nice well maintained Duplex will sell for a pretty good price now with multiple offers”, or something to that effect. The Duplexes that don’t sell quickly generally have these characteristics.
- Poor or “Fair” Curb Appeal and General Appearance – Lack Pride of Ownership.
- Rents that are lower or much lower than Market Rent.
- Price is not reflective of the above 2 conditions.
Low Rents – Updates/Upgrades:
If you are thinking of Selling your Duplex or for that matter any kind of Rental Investment Property, you might think about upgrading/updating the property a little.
Having the same great tenants over several years time does not translate into a much better positive outcome in the sale if the rents they are paying are only about 1/2 of what the same unit would rent for today.
Generally if you aren’t keeping the rents up, you aren’t maintaining the property because you don’t have the cash flow. Tenants know when they are getting a good deal.
However, if you are a buyer and make an offer on one of these types of properties I’m describing above, you’ll have to take into account the Updates/Upgrades you might be faced with to get the “higher rents” the Seller says you can get.
We recently were in escrow on a Rancho Cordova Duplex the Seller has owned for almost 30 years. Both units were in need of work. One of the units had 6 people living in a 2 bedroom 1 bath unit. Both units were paying only $800.00 per month when the “market rate” is in the $1,300 to $1,400 range.
The deal fell through because the Buyer wanted an adjustment in the price to reflect the deferred maintenance and the low rents. The buyer would have to get possession by giving a 60 day notice to terminate tenancy before being able to start the “rehab” process. The unit would then be vacant for another 30 days at least. There was too much to over come… Low Rents /Poor Condition/High Price.
Let me know what you think of these stats.
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NUMBER OF UNITS FOR SALE – SOLD- PENDING
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LIST PRICE TO SALES PRICE RATIO – AVERAGE DAYS ON MARKET
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If you are thinking of Buying a Sacramento Duplex you want to take into account not only the condition, but the existing tenants and their current rent as well. As long as you are aware of these issues, you’ll make a better informed decision on whether to go through the deal or not.
In the mean time…
Make it a Great Day…!
Ed Favinger, Broker, CRS, GRI, SFR – 916.203.1260 – favinger@rwnetwork.com
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