Duplex Market Still Strong – Low Inventory – Prices Continue Up

Even Fixers Get Multiple Offers..! Just Not Top Dollar..!

I haven’t written an article in a while and thought I’d get back in here and update those of you that follow this blog from time to time

RE-SALE SACRAMENTO AREA DUPLEXES

Duplex sales in the Sacramento Region are still pretty healthy with rising prices and rising rents because of a Strong Economy.

Mistakes I See Sellers Make:

The biggest mistake I see some Duplex Sellers now on the market, is thinking an “as is” sale of a property that has a lot of “deferred maintenance” will sell for just about what a “Fixed Up” property will bring in.Duplexes - 1

Another mistake,  besides not maintaining the property, would be an existing unit Rents far below the market.  The reason usually given is “they are long term tenants”.  This reason ignores the fact when they go to Sell the Duplex, a new owner is going to have to deal with tenants receiving large rent increases.

Why to Avoid Those Mistakes:

Because they haven’t raised the rents during the long term tenancies, these tenants know they have a good deal and never report much in the way of needed repairs and since they always pay the rent on time,  the Seller hasn’t been by the property or maintained it unless it was an emergency.

Because the rents were so low, there was no incentive for the owner to make any upgrades to or any effort to enhance/upgrade.   Most of the time they only made repairs after a complaint.

Example of what I’m talking about:

I’m in escrow now on a Fair Oaks duplex where the HVAC unit will have to be repaired to the tune of $2,000 because the unit hasn’t been serviced in years.  What’s more… Even with this fix, there’s no guarantee and the contractor said you’d be better off getting a new unit.  Had it been maintained and serviced on a regular basis, the unit would have had more potential life and not become an issue in the Sale Escrow.

So the Bottom Line…? 

Prices are going up for sure and if you want top dollar for your investment, you should take an honest look at it and if repairs/upgrades are warranted, do them.  When you then raise the rent, you’ll see most tenants will put up with it because you have maintained it and they are proud to live there.

When you have maintained the Property and maintained Rents at Current Market, you are using the “prudent investor standards”.

By the way… Have you heard Interest Rates are coming down….?

If you’re thinking of Selling or Investing in the area, please give me a call at 916.203.1260.   I’ll actually answer the phone.. Texts will work also.

In the Mean Time…?

Make it a Great Day…!

 

Related stories

City of Sacramento Adopts Rent Control Ordinance BPE Law Group Blog

 

 

 

 

 

How’s the Real Estate Market…?

Foreclosures At a 20 Year Low

I get this question all the time from people asking me “how is the real estate market?”.

The short answer is, Great…!

I have some links below that will give you some insight but in the greater Sacramento Area I think it’s one of the best I’ve seen.   Why do I say that…?

Have you tried to get a contractor or handyman to fix something at a rental…?  When you’ve got contractors busy with a back log of weeks out, that’s probably one of the best signs of a great real estate market.

 

Click Here for an article regards the low Foreclosure Rate.

And if you’re an investor curious about rents, click here for that article.

Aerial shot of Folsom, California with Folsom Lake in background.

Aerial shot of Folsom, California with Folsom Lake in background.

If you’re thinking of getting into the market for a new home or you are an investor looking to purchase your first rental property or you want to add to your portfolio, please call/text or email me at anytime.

 

Looking for a Duplex to buy…?   I’ve got one that you should take a peek at.   Click Here for the information on this Bread and Butter Property waiting for you.

 

 

In the Mean Time…?  Make it a Great Day…!

Ed Favinger, Broker, CRS, GRI, SFR    916.203.1260   favinger@rwnetwork.com

 

Sacramento Bank Owned Duplex For Sale – New On The Market…!

Sacramento Duplexes For Sale are Hot Now…

Hey check out this Sacramento Duplex for sale that just appeared on the market.   When I see a Bank Owned/REO foreclosure Duplex like this,  I know this one will be sold “as is” and that may concern some investors.

This Duplex does need some work, however it’s been updated some and I think it’s just been neglected.

I think you will find this Duplex will be a great investment if you’re looking to invest in the Sacramento Area.

I toured this today and have a Video below.

I also have a “Proforma Cash Flow Analysis” for your review of this Duplex by CLICKING HERE.

Let me know what you think.   We also manage a Duplex just down the street, so we know the area and the potential income you can get from this Bank Owned Duplex.

In the mean time…?

Make it a Great Day…!

Ed Favinger, Broker, CRS, GRI, SFR, CDPE

 

Sacramento Apartment Market Projections – 2017

Just passing on an article and information I just received.

If you’re thinking of getting into the Multi-Family Housing market as an Investor and you’re new at it, I’m sure you’ve thought a lot and hopefully have done some research.   You can always contact me for more information and set up a time for a free consultation.

The Sacramento Apartment Market is one of the top 20 in the nation and is still affordable especially compared to some markets in the San Francisco Bay Area.

In our market we find it’s hard to find a 2 bedroom 1 bath apartment unit with lots of amenities for under $1,000 per month.

To get an idea of what we have for rent go to HavenRents.com and you’ll get a sense of what the prices are for various types of properties we currently have available.   You can also go to the “rentals page” here on this site.

I received and thought I’d share a 2017 market projection from CBRE, a large real estate investment company that works in Retail, Office, Industrial and of course Multi-family projects through out the the country.

CLICK HERE for that article and go to Page 31 for their “Multi-Family” projections.   I think you’ll appreciate their findings and conclusions.   It looks to me like the Sacramento Region’s Multi-Family market should remain strong.   I think this remains especially true in the smaller multi-family units, such as Duplexes, Four-Plexes or small apartment complexes.   Why…?  Because they haven’t built any in the last several years.   Sacramento Duplexes/Four-plexes for sale don’t stay on the market very long.

So if you have stumbled on this blog site and are thinking of investing in the Residential Real Estate Market in the Sacramento area please contact me at anytime.    We specialize in the Sales and Management of Single Family Homes, Duplexes, Tri-plexes, Four-plexes and small to medium sized apartment complexes.

In the Mean Time…?

Make it a Great Day…!

Ed Favinger, Broker, CRS,  GRI, SFR, CDPE,     favinger@rwnetwork.com   916-203-1260

 

Rents Are Up in The Sacramento Area – Old News To Us in Real Estate Sales & Management.

When The News Hits the Sacramento Bee – You Know it’s “Old News” When It Comes to Real Estate..!

If you’ve followed my blog site for any length of time I’ve pointed this out several times.   The reason you ask…?  They stopped building Apartments and just about anything else here because of the recession.  They are only now beginning to ramp up, but mostly single family homes.

And since they are not building more apartments for middle class folks just starting out, rents have gone up.    What apartments they are building or planning on building are “subsidized” housing or the more “high end” apartment complexes with lots of amenities according to a recent article in the Sacramento Business Journal.

I’ve said to many people seeking to find a home or an apartment to rent in Folsom, Orangevale, Roseville or any other area in the Sacramento Region that,  “you probably need to know somebody inside to get a decent rental anymore”.    I wrote about it here.

Many of the investors I have placed into Duplexes, Four-plexes and Small Apartment complexes know they can get “higher rents”, so most of them have improved their properties to take advantage of the upswing in rents that can be derived.   That also was written about in today’s Sacramento Bee article.

So CLICK HERE for that latest story from The Bee.   Let me know what you think.

In the Mean Time…?

Make it a Great Day…!

Ed Favinger, Broker, CRS, GRI, SFR, CDPE       favinger@rwnetwork.com   916-203-1260

 

Open House Today May 28th

We’ve got one in Cameron Park and Folsom.

Check out two great homes open from 1Pm to 3Pm today

2844 Aquamarine Circle, Rescue – Hosted by Joni Hewitt

716 Hildebrand Circle, Folsom – Hosted by Cynthia Montana

In the mean time…?

Make it a Great Day..!

Ed Favinger, Broker    favinger@rwnetwork.com   916-203-1260

 

Rates Can Still GO LOWER – Believe it or Not..!

See Frank and Brian – The National Real Estate Post Update

If you want to keep up in the Real Estate world, you might watch these guys from time to time because they do have interesting perspective… Then, after you watch the video below,  sign up for their updates.

If you’re looking for a new home or investment property it helps to have a finger on the pulse of the market and these guys are just one source.

frank and brianThey do regular Real  Estate and Mortgage Loan updates during the week.   I can’t watch them all but the headline today did catch me so I had to “point and click”  to check out what they had to say.

They deliver some great information and a little humor as well thrown in.

I think you’ll find this video worth the time and if you like these guys…..? go sign up for their updates.. !  You don’t have to be in real estate or the lending business to get on their list.

The “relevant” point regarding rates starts at the 3:56 mark

I think you’ll come away with the idea it’s not a bad time buy.  Rates for “investment” properties as of yesterday were at the 4.375% and “owner occupied” at around 3.50-3.75%.

If you’re renting, rents are going up and buying a home is actually “cheaper”… so you might want to consider getting into home now.

In the Mean Time…?

Make it a Great Day…!

Ed Favinger, Broker, CRS, GRI, SFR, CDPE     favinger@rwnetwork.com   916-203-1260

 

Be a Real Estate Investor, Not a Slum Lord…!

If You Are an Investor and Own Rentals, Don’t Ignore Stuff.   These people did and now they’re on the Front Page above the fold in the Sacramento Bee.

In fact you’ll be surprised how much attention you’ll get.

I thought I’d share my thoughts on this issue.   When you buy any kind of Residential Rental property, don’t ignore repairs and always keep up and maintain your property.

If you don’t maintain your property and are like the folks that are the subject of these videos and the news stories, you’ll get lots of the same negative publicity and worse big time law suits.

Reminds me of a story from a few years ago.   An Apartment Complex in Rancho Cordovo had some of the same issues as here.   Guess what…?  They lost their investment… lawsuits and foreclosure besides being on TV and in the News.  CLICK HERE  for that story I wrote about a while back.

The Solution – Professional Management

As a Property Manager and Investor you’ll be glad you hired us or someone as good as us to make sure your properties are well maintained and in “compliance” with the various codes.

If you ignore issues on your property… which is what Slum Lords are accused of,  together with the tight supply of rentals and rising prices out there…?   Trust me you’ll be part of the problem that will invite more and more government oversight.  Not just on you, the Slum Lord, but on the rest of us that invest in Residential Real Estate but maintain our properties.   Is that what we want as an industry, more government involvement…?

 

Here’s the original article from Sunday’s Sacbee.   Check out the videos below.

 

You also get on Local TV

 

My advice is to keep some reserve so you can not only maintain it, but improve upon it as well.    Make your investment an asset to the community by putting something back in.

If you need Property Management help, then call us today.

In the Mean Time

Make it a Great Day

Ed Favinger, Broker CRS, GRI, SFR, CDPE

 

Sacramento Duplexes for Sale – Some Recent Sales Statistics – Prices are Up…

I’m seeing a little bit of greed set in with these stats… More below

 

One of the things I’ve noticed in a rising market and a market where buyers are king,  is the consistent failure of a lot of these Investors going out of the business because they hate maintenance issues and dealing with the tenants.   It doesn’t matter if the market is tight like it is now with low inventory or flooded with Sellers trying to get out.stats

I’m going to profile a local investor in the next few days and show you not only how much he’s improved his potential cash flow because of the care and maintenance of his properties, he’s been a factor in improving the surrounding neighborhoods as well.

You’ll come away with the realization that maintaining a quality rental will get you the best tenants paying the absolute highest in market rents no matter if you’re in a rising or stagnant market.

The Stats…    However, I know the purpose of this post was to show you some statistics for 3 zip codes we’ve had a lot of experience not only in the sales side,  but also in managing the rentals there as well.

These “stats” are Duplexes only for those zip codes, 95670, 95826, 95827.    While I’ve been involved in the greater Sacramento Region in sales of income properties, I kind of like this area because it’s along the Highway 50 corridor.

_________________________________________

Following Data is from November 1,  2015 to Date, April 20, 2016
For Zip Codes – 95826, 95827 & 95670
Closed Sales Data – 9 Sales Closed Sales Data – 12 Sales
in Zip Codes 95826 & 95827 in Zip Code 95670
Average Price  $302,201 Average Price  $260,092
Highest  $350,000 Highest  $286,000
Lowest  $259,008 Lowest  $198,000
Median  $293,000 Median  $270,000
 Active On the Market Now – 4 Pending Sales – 5
In all 3 zips -95826, 95827 & 95670 95826, 95827 & 95670
Avg List Price  $305,000 Avg. List  Price  $308,450
Highest  $329,900 Highest  $350,000
Lowest  $274,990 Lowest  $269,900
Median  $305,000 Median  $303,000

BOTTOM LINE…   As you can see there’s not much available Inventory…

So if you are thinking of Selling a Duplex in one of these or any other zip codes/areas of the Sacramento Region, call me.

If  you are not happy with your cash flow give us a call because we are the “turn around specialist” for small rental properties in the area.

 

In the Mean Time…?

Make it a Great Day…!

ED FAVINGER,  916-203-1260 favinger@rwnetwork.com

 

If You Want Top Dollar for Your Rental Investment Property

Don’t Make the Mistakes This Duplex Owner Did.

I’m in the middle of an escrow for the sale of a Duplex located at 2614-2616 Bravado, Rancho Cordova.   I posted an article about it a couple of weeks ago and pitched it to a local investor along with other people in my data base.

The current owner paid about $146,500 in 2009 and really hasn’t done much to maintain it in the interim with the major exception of an Heating and Air unit about a year or so ago.

While this property started out at an asking price of $295,000 back in December the condition of this Duplex wouldn’t warrant an offer any where near that.   I know the area very well, we manage several Duplexes in this neighborhood including one directly across the street.   So I kept an eye on it and gradually the asking price came down to something decent at $275,000.    We made an offer and started the process out at $270,000.

I have a theory that has pretty much held up over the years.   If you ignore the curb appeal and don’t show pride of ownership, trust me the Tenants will pick up on that vibe and probably not take care of it either because if you don’t care about it…? why should they…?

When you maintain your property, inside and out you get the best possible tenants that will not only pay the rent on time but will take care of the property because they know you care about it.   If they don’t,  because you care, they know you will give them the appropriate “fix it” notice called a “3 day notice for covenants“.   This owner did a poor job of managing this and it cost her.

In the initial walk through,  we find out the tenants have dogs that are not permitted in their leases.   Of course the back yards were a mess with lots of “dog droppings” that had not been picked up.

Not only that, the interiors were in poor shape with one kitchen having drawers that were falling apart.

After the Buyer had this Duplex inspected by North American Home Services for the Home & Pest Inspections along with a roof report from Eagle Ridge Construction, the only way he was going to move forward was to get a big drop in the price to make up for the deferred maintenance which included the need for a new roof.

The price we finally settled on is $245,000 “as is”.   The existing tenants are; one on a month to month Section 8 which requires a 90 days notice to vacate if he wants her out and the other one we have to wait until this coming September to get possession because she’s on a lease.   In the mean time, the rents are frozen in place for a period of time.

Here are pictures I got of the property – one that was taken by Google in Street View March 2015.  Click on the picture and you’ll see how it looks from the street today just a year later.screen shot of 2614 bravado March 2015 street view

I hope the conclusion that you come away with by reading this is when you don’t maintain and manage your rental property in a “professional manner” you will get lousy tenants, you will not get the highest possible rents and when you go to sell, you’ll have to lower your expectations “big time”.

The Buyer/Investor on this deal made a comment to me after he looked up the address where the people that own this property lived.  He noticed it was in an upscale area.   His comment was that it was amazing to him how poorly this Duplex looked but he bet where they lived looked a lot better.

Let me know what you think.

By the way… If you currently own rental properties and need management help, check out our Property Management Service that is “2nd to none” by Clicking Here

If you are thinking of Selling or you are interested in buying a Duplex, Fourplex or an Apartment complex in the area, please call/text or email me at anytime.

In the Mean Time…?

Make it a Great Day..!

Ed Favinger, Broker, CRS, GRI, SFR, CDPE    favinger@rwnetwork.com   916-203-1260