Are you seeing more properties become available? We have, and it is encouraging. Owners still want more than the properties are worth, but with options come opportunities. Love it!
A little bit of improvement in clarity on the future after an election helps, and a feeling of plans put on hold for too long helps too.
Throughout this pandemic, even the year or two prior, we have heard brokers tell us over and over that nothing hits the market, it’s bought up before anyone even knows about it. And all of the value-add properties have been bought and renovated. Nothing could be further from the truth. We have a 17 year old property, great structure, nice location, and in good condition, but the interiors were clearly dated.
These are terrific opportunities to renovate and create a killer apartment, features that tenants today will pay for. When you see properties that were renovated just a few years ago, don’t ignore them. The seller wants you to think they’re worth more because they’re renovated, and you want a value-add deal, but there could easily still be an opportunity for you to improve it.
Also don’t believe everything about rent freezes and no upside. We’re very conservative in our underwriting and we don’t expect real estate prices to resume the trajectory they had up to a year ago, but the three to five-year future is not a dismal picture. Look at multifamily in the 2008 recession, which was pretty bad. Valuations held up much better than most other assets. If you are conservative today, you will be
wealthy in three to five years.