SoCal Multifamily Sales Pulse - June 27, 2021 - July 3, 2021
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Here's What's Happening In The Market, Here’s What This Means For You
Mortgage Servicers Brace For Fallout As Covid Bailout Comes To An End
The nation’s mortgage servicers are gearing up for the biggest wave of delinquent loans since the subprime mortgage crisis, but this time they say they are ready.
The first wave of borrowers to enter the government’s coronavirus mortgage bailout program are entering their last possible quarter for relief, which means that come September they will either have to start paying, sell their homes or go into foreclosure.
Mortgage bailout programs, both government and private sector, launched at the start of the Covid pandemic. The government originally allowed borrowers to delay their monthly payments for up to a year. That was then extended to 18 months. Each quarter, borrowers must re-up.
An estimated 7.25 million borrowers have participated in forbearance programs at one point or another throughout the pandemic, representing 14% of all homeowners with mortgages, according to Black Knight. About 72% of all participants have since left their plans, while 28%, or just more than 2 million, remain in active forbearance.
This week and next, a total of more than 350,000 borrowers will be reviewed for extension or removal from forbearance, according to Black Knight. Of the 146,000 plans reviewed this week, 44,000 homeowners left forbearance, while the plans of 102,000 were extended. With roughly two-thirds of borrowers remaining in forbearance, Black Knight estimates that 575,000 plans will expire in September and the beginning of October, meaning mortgage servicers will be facing the daunting task of dealing with about 15,000 troubled loans per day.
Orange County
Orange County multifamily Closed Sales Last Week was down from 21 closed sales the prior week to 16 Closed Sales Last Week. Closed Sales - Average Days on Market dropped to just 19 days. If your an Orange County multifamily investor and you see a property you like, don't delay in submitting an offer. Out of the 16 Closed Sales Last Week there were 7 closed sales in coastal/beach cities. One astute investor was able to successfully play monopoly and purchased three contiguous 4 plexes in Santa Ana.
The Total Number of Active Listings remained about the same at 154 listings. Active Listings, Dollar Volume remained below $500,000,000 for the second consecutive week.
The monthly Average Cap Rate and Average Gross Multiplier were unchanged from last month while the monthly Absorption Rate went from 1.63 months to 1.9 months. Orange County still has the lowest monthly Absorption Rate out of any of the other Southern California counties. But not by much - Long Beach is a close second at 1.95 months.
Live MLS and Sale of the Week Link expires in 30 days after published View Live MLS Data View PDF Version
Long Beach
Long Beach multifamily Closed Sales Last Week came in at average with 10 Closed Sales Last Week. Closed Sales - Average Days on Market held steady at 34 days on market.
Overall listing inventory dropped again from 100 listings the prior week to just 90 listings last week. The pickings are getting slim for multifamily properties in Long Beach.
The monthly Absorption Rate also dropped, going from 1.98 months to 1.95 months. The Average Gross Multiplier jumped from 13.3 last month to 14.28 this month. While the Average Cap Rate was relativity unchanged at 4.76% this month and 4.77% last month.
Live MLS and Sale of the Week Link expires in 30 days after published View Live MLS Data View PDF Version
Los Angeles County
Los Angeles County multifamily Closed Sales Last Week were a whopping 111 closed sales. This is the highest amount of closed sales in recent weeks. The Closed Sales - Average Days on Market was average at just 37 days on market. Transactions Sold At or Above Asking Price was at 61 transactions, again more than half of the total closed sales. If you're an investor in Los Angeles multifamily you better be ready to compete for the desirable properties.
The overall inventory held steady going from 1,753 to 1,738 Total Number of Active Listings. Active Listings, Dollar Volume remained elevated at $8,154,854,412.
The monthly Average Cap Rate was almost unchanged going from 4.77% to 4.76% and the monthly Average Gross Multiplier increased from 14.17 to 14.28.
Live MLS and Sale of the Week Link expires in 30 days after published View Live MLS Data View PDF Version
San Diego County
San Diego County multifamily had 24 Closed Sales Last Week. With 195 Total Number of Active Listings that's a pretty significant amount of closed sales in relation to the inventory amount. Out of the 24 Closed Sales Last Week 17 transactions sold in 10 days or less and 17 transactions Sold At or Above the Asking Price. The 24 closed sales consisted of mostly 2 and 4 unit buildings (19). And 17 of the Closed Sales Last Week were located in the city of San Diego.
With 30 New Listings Last Week, the Total Number of Active Listings increased to a most recent high of 195 active listings.
The monthly Absorption Rate increased from 1.97 months to 2.14 months. Still extremely low. The monthly Average Cap Rate and Average Gross Multiplier were unchanged from last month.
Live MLS and Sale of the Week Link expires in 30 days after published View Live MLS Data View PDF Version
Riverside County
Riverside County multifamily showed up with 9 Closed Sales Last Week. Not much off of the usual number of closed sales. Last week saw an increase in Closed Sales - Average Days on Market from 24 days to 39 days - still low compared to recent weeks. All of the Closed Sales Last Week were sold below $1,000,000. With one sale coming in at just $100,000 in Desert Hot Springs. Most (7 of the 9) of the Closed Sales Last Week were on the market for less than 20 days.
With 13 New Listings Last Week, the Total Number of Active Listings increased into triple digits (101) for the first time in quite a while.
After declining for several months the monthly Absorption Rate increased to 2.34 months. The monthly Average Cap Rate and Average Gross Multiplier were unchanged from last month.
Live MLS and Sale of the Week Link expires in 30 days after published View Live MLS Data View PDF Version
San Bernardino County
San Bernardino County had 13 Closed Sales Last Week. Just about on par with recent weeks closed sales. Except for a couple of closed sales coming in at 122 and 124 days the majority of the Closed Sales Last Week sold in 26 days or less. The lowest-priced closed sale of the week was a duplex in 29 Palms that sold for $310,000 after being initially priced at $216,500. The highest-priced closed sale was a Covington style 4 plex located near Ontario Airport that sold for $1,200,000 in just 4 days.
With 17 New Listings Last Week inventory levels held steady at 130 Total Number of Active Listings. Months of Inventory fell from 8 months to 7 months due to the shorter monthly Absorption Rate.
The monthly Absorption Rate declined significantly from 2.84 months to 2.16 months. The monthly Average Cap Rate and Average Gross Multiplier were unchanged from last month.
Live MLS and Sale of the Week Link expires in 30 days after published View Live MLS Data View PDF Version
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