Multifamily inventory is outpacing sales across several Los Angeles submarkets, increasing competition among sellers and reinforcing the importance of realistic pricing.

What Rent Increase are We Getting for RSO Units? After four years of no rent increases, the LA city council had a hearing to freeze rent increases another 6 months to July which was thankfully shut down. Starting in February 2024, landlords will be allowed a 4% rent increase on units under RSO. The original proposal was for a 7% rent increase which many believe really should have been a 10%+ increase to make up for significant increases in expenses since 2020 while rents rema

When Will the Bid - Ask Spread Narrow? Over the past six months the bid - ask spread has continued to increase with buyers desiring a cap rate closer to the cost of debt and sellers remembering their building was a 3% cap less than two years ago. Some sellers are getting more realistic as there have been some recent sales trading sometimes one third off their original list price. The average listed cap rate in the core markets of LA is 4.7%, which is the highest we have seen

Where are Interest Rates Now for LA Multifamily? Many lenders have programs in the mid to high 5% range which is around 50 basis points lower than the last quarter when we saw inflation growing at a higher rate. Wall Street and overall commercial real estate industry are underwriting for higher rates longer term than was expected months ago. Many analysts are expecting the federal funds rate to cap out in the 5% range. This is still another 50 - 100 basis points from where we

How High are Cap Rates on LA Rent Control Multifamily? Within the past 90 days throughout all of Marcus & Millichap closed rent control LA multifamily the average cap rate is still very low at 4.25%. The highest closed cap rate was 6.7% with the lowest at 2.72%. It is impressive to consider how low the average cap rate is even when buyers were closing on locked in debt from 30–45 days ago in the low 5% interest range. Currently interest rates are in the low 6% range with the

Hiring continues, but signs of slowdown emerging. The labor market welcomed 263,000 new jobs in September, above the long-term monthly...

Last month’s employment report ideal for Fed objectives. Employers added 315,000 personnel to payrolls in August, below the 526,000 jobs...

The red-hot single-family sector rapidly cooled as the Federal Reserve stepped up its fight against inflation. Surging mortgage rates...

Does Today’s Market Benefit the Buyer or the Seller? With the market shifting over the past quarter due to recession risks and higher rates, values have started to come down a little bit. Certain products such as non-rent control multifamily in LA have not seen any meaningful price corrections however the typical rent control building in LA has seen some price drops. Buyers are calling us more and more asking for the “good deals” in anticipation of a larger market correction

Job growth overcomes inflation concerns. Total employment increased by 390,000 personnel in May, consistent with April hiring, while the...

Market Update For the majority of LA apartment brokers, the past 2 quarters have been extremely active. Investors are still finding good reasons to both buy and sell local multifamily. On a national level, commercial real estate volume hit $450 billion for the first three quarters of a year, which is the highest volume since 2007. Overall commercial real estate nationally has increased by 18% this year and 8% higher than pre-pandemic levels. 60% of all the volume was comprise

Investment strategies have changed a lot in the historic 10-year economic expansion that's still ongoing. During the span, major...

Trump Administration Needs Bipartisan Support to Decrease Government Roles of Freddie Mac, Fannie Mae The U.S. departments of Treasury...

Smaller Apartments Gaining Significant Traction as Renters Accept Rent-Location Trade-off Demand for rental housing once again outpaced...

Property Damage Might Slow Refinancing of $3 Billion in Loans Real estate fallout could extend well beyond the immediate damage caused by...

Golden State Edges Closer to Joining Oregon, New York With Statewide Regulation California moved a step closer to becoming the third...

Amended Bill to Move to State Senate Committee On July 9 The author of a proposed California bill to limit annual rent increases has...

Mortgage Bankers Join Real Estate Groups In Opposing Assembly Bill 1482 A California bill aimed at limiting annual rent increases to 7%...

Measures to Protect Tenants, Produce More Rental Housing Get Luke-Warm Reception California lawmakers, under pressure from real estate...

Tenant Protection Measure Passes After Several Concessions to Landlords, Real Estate Brokers The California Assembly narrowly passed a...