As we approach May rent payments, here’s the numbers for April.
As multi-unit owners in the East Bay, we now have a clear example of why properties always sell for, or are valued at, a premium. Despite all the headlines at the beginning of April that over 30% of tenants were not paying April rent, we have seen a much different result.
As of today, I have spoken to over 80 East Bay multi-unit owners. In total, they own over 650 units.
In my conversations, only four (4) tenants had not paid the full April rent. Statistically, this is less than 1%. I think across the nation, the average is closer to 15%.
This is much lower than the headlines were saying at the beginning of April. Metros such as Las Vegas and Orlando are reporting much higher percentages of rents not being paid.
Currently, the business news headlines and large apartment owners associations are saying that May will be worse as this will be the first full month of Shelter in Place rules.
As we forward we will have to wait and see. For the buildings that we own personally, we still have only had requests for more quarters for laundry, no mention of not paying May rent on time.
Here is an article that summarizes the California Apartment Association recommendations:
CAA advice for April/May rents:
Another article on what the current rules are for Oakland:
New Rules for Oakland rents
Please feel free to reach out to me with questions or concerns.
Our team did just list and close a nine (9) unit Berkeley property this month. Things are still closing, although it does require some creativity around inspections, appraisals, and one on one showings.
Oakland/Berkeley Rental Market
Before the “shelter in place” directive, the rental market was still solid and jobs were still being added to Oakland and Berkeley. As we get through this, that should continue.
Current Market For Building Sales
Right now there are many people feeling very anxious, and that is not the time to make big important decisions.
For example, if you want to sell your apartment at this time, we can help you with an evaluation and guidance. I have spoken to two of the top lenders for East Bay multi-units and they are working on, and closing transactions at this time. I can forward their contact info if you want to speak with them.
Right now, If buyers have a good down payment they can get a loan and I can navigate you through the process.
If we just work with our tenants and make sure that everyone is safe and healthy, we can build better relationships and get through this.
Be prepared to start getting phone calls from brokers who say “now is the time to sell, before it gets worse”. Unless they have that magic 8 ball, we don’t know the future.
We do know that people still need their housing and over time we will get back to where we were before the Covid virus.
It is always important to get guidance and advice from experienced multi-unit brokers who will market your property extensively to all potential buyers and brokers. Posting a new building on all websites and sending out emails blasts gives the property visibility to literally tens of thousands of potential qualified buyers.
I did a presentation on increasing your rental revenue at the East Bay Rental Housing Association in last year. Click Here: Maximizing the Return on your Investment for the highlights.
Interested in getting a valuation of your buildings?
Contact me and we can do an estimate with a quick drive by. Getting your current rents/number of units will allow us to get a estimate of value. Again, if you have any questions about rents for an upcoming vacancy, questions about tenant’s issues, or need advice on a repair person, please do not hesitate to call or email.
Why you’ll benefit from working with me
In addition to managing our properties for the past 20 years, I have worked on 45+ multi-units transactions in the past 10 years, as a real estate agent specializing in multi-unit properties. I have learned so much from both perspectives. Most importantly, this is a complicated process much different from working with single-family home buyers and sellers.
The goal of this newsletter is get feedback and share with this community our successes and challenges to make all of more successful and increase our cash flow! Questions about market rents for your units, tenant issues, or need specific repair people? I can help. Please give me a call or an email.
Looking forward to a much more social June!