The Daily Brief

July 29th

Friends,

In case some of you are looking for some investment real estate, this may be a good time to start trying to acquire a small apartment building. Since the financial crisis began, lenders have been less than accomodating.  In addition, sellers were loathe to sell buildings at the bargain prices being demanded by buyers.

The net result was a dramatic slowdown in apartment sales in San Diego and in the County. Unless you could find a seller who was in some other form of distress, business losses, divorce and so on, there was little chance of acquiring a building at a bargain price.

Complicating the picture were low interest rates and low vacancy rates.

As this crisis grinds on and continues to claim victims, the time appears to be a little more favorable for buyers. Class B and C apartments are a bargain in my view as they can never be replaced unless the rental structure takes dramatic turn.

Mission Hills and Hillcrest residential real estate has remained relatively flat in terms of prices over the past 12 months. This speaks to the fact that quality neighborhoods like those in the 92103 zipcodes weathered the early part of the storm better than lesser neighborhoods.  Quality, as always, means safety and this applies to houses and apartments.

Regards,

Jim