Buying, selling and operating apartments in Portland

Portland Apartment Sales – Jan 19

1 March 2019
Leave a Comment

To download the individual sales report, right-click the link below and “Save As”:

 

<<<Portland_Jan19vsJan18_AptSales>>>

 

Highlights:

  • Gross sales dollars Jan 19 YTD = $97M is a 41% DECREASE over Jan 18 YTD = $163M
  • $/unit Jan 19 YTD = $161K is a 7% DECREASE over Jan 18 YTD = $174K.
  • $/SqFt Jan 19 YTD = $199.75 is a 27% DECREASE over Jan 18 YTD = $271.89
  • CapRate Jan 19 YTD = 5.33% is a 0.2% INCREASE over Jan 18 YTD = 5.32%

Biggest item is the effect of the newest OR rent control law passed by the Legislature.  Interest rates and strength of the rental market in Portland (especially for new construction) are the biggest threats/motivators.

I should have a 2013-2018 Portland Apartment Market History by mid-Mar 19.  If you’d like more information on 2012-2017 Portland Apartment Market history.  Is posted at:

https://portlandapartmentsales.com/2018/03/22/portland-apt-market-2017-annual-report/

If you like numbers, you’ll find this recap of the market for the past 5 years of interest.  You can eMail me for a copy also.

– Free financial analysis of your property, eMail/call me for a SAMPLE report.  It will be helpful if you’re making decisions about futures or operations and includes I&E comparison to neighboring properties along with recent sales and rent comparables.

Steve Morris | Vice-President
IMG Northwest
1234 SW 18th, Suite 102
Portland, OR 97205
Phone: 503.970.4593 
steve@imgnorthwest.com | www.imgnorthwest.com
OR License # 200202054 | WA License # 24512

Advertisements

Portland Apartment Sales – Dec 18

1 February 2019
Leave a Comment

To download the individual sales report, right-click the link below and “Save As”:

<<<portland_dec18vsdec17_aptsales>>>

Highlights:

  • Gross sales dollars Dec 18 YTD = $2523M is a 44% INCREASE over Dec 17 YTD = $1750M
  • $/unit Dec 18 YTD = $187K is a 6% INCREASE over Dec 17 YTD = $177K.
  • $/SqFt Dec 18 YTD = $222.37 is a 10% INCREASE over Dec 17 YTD = $201.63
  • CapRate Dec 18 YTD = 5.37% is a 0.2% INCREASE over Dec 17 YTD = 5.36%

Including all sales, we are at a prelim number of $2.5B in annual sales rate (vs. $1.7B for 2017 and $2.95B for 2016).  Interest rates and strength of the rental market in Portland (especially for new construction) are the biggest threats/motivators.

I should have a 2013-2018 Portland Apartment Market History by mid-Feb 19.  If you’d like more information on 2012-2017 Portland Apartment Market history.  Is posted at:

https://portlandapartmentsales.com/2018/03/22/portland-apt-market-2017-annual-report/

If you like numbers, you’ll find this recap of the market for the past 5 years of interest.  You can eMail me for a copy also.

– Free financial analysis of your property, eMail/call me for a SAMPLE report.  It will be helpful if you’re making decisions about futures or operations and includes I&E comparison to neighboring properties along with recent sales and rent comparables.

Steve Morris | Vice-President
IMG Northwest
1234 SW 18th, Suite 102
Portland, OR 97205
Phone: 503.970.4593 
steve@imgnorthwest.com | www.imgnorthwest.com
OR License # 200202054 | WA License # 24512


Portland Apartment Sales – Nov 18

21 December 2018
Leave a Comment

<<<Portland_Nov18vsNov17_AptSales>>>

Highlights:

  • Gross sales dollars Nov 18 YTD = $2163M is a 62% INCREASE over Nov 17 YTD = $1335M
  • $/unit Nov 18 YTD = $188K is a 10% INCREASE over Nov 17 YTD = $171K.
  • $/SqFt Nov 18 YTD = $219.22 is a 12% INCREASE over Nov 17 YTD = $195.91
  • CapRate Nov 18 YTD = 5.32% is a 1.3% DECREASE over Nov 17 YTD = 5.39%

Including all sales, we are at a run rate of $2.4B in annual sales rate (vs. $1.7B for 2017 and $2.95B for 2016).  Interest rates and strength of the rental market in Portland (especially for new construction) are the biggest threats/motivators.

If you’d like more information on 2012-2017 Portland Apartment Market history.  Is posted at:

https://portlandapartmentsales.com/2018/03/22/portland-apt-market-2017-annual-report/

If you like numbers, you’ll find this recap of the market for the past 5 years of interest.  You can eMail me for a copy also.

– Free financial analysis of your property, eMail/call me for a SAMPLE report.  It will be helpful if you’re making decisions about futures or operations and includes I&E comparison to neighboring properties along with recent sales and rent comparables.

Steve Morris | Vice-President
IMG Northwest
1234 SW 18th, Suite 102
Portland, OR 97205
Phone: 503.970.4593 
steve@imgnorthwest.com | www.imgnorthwest.com
OR License # 200202054 | WA License # 24512


Portland Apartment Sales – Oct 18

29 November 2018
Leave a Comment

To download the individual sales report, right-click the link below and “Save As”:

<<<Portland_Oct18vsOct17_AptSales>>>

Highlights:

  • Gross sales dollars Oct 18 YTD = $1986M is a 170% INCREASE over Oct 17 YTD = $1232M
  • $/unit Oct 18 YTD = $188K is a 10% INCREASE over Oct 17 YTD = $171K.
  • $/SqFt Oct 18 YTD = $222.25 is a 13% INCREASE over Oct 17 YTD = $196.3

We had the strongest month on record ($450M) vs. Oct 17 due to several large sales.  

Including all sales, we are at a run rate of $2.4B in annual sales rate (vs. $1.7B for 2017 and $2.95B for 2016).  Interest rates and strength of the rental market in Portland (especially for new construction) are the biggest threats/motivators.

If you’d like more information on:

– 2012-2017 Portland Apt Market history.  Is posted at 

https://portlandapartmentsales.com/2018/03/22/portland-apt-market-2017-annual-report/

If you like numbers, you’ll find this recap of the market for the past 5 years of interest.  You can eMail me for a copy also.

– Free financial analysis of your property, eMail/call me for a SAMPLE report.  It will be helpful if you’re making decisions about futures or operations and includes I&E comparison to neighboring properties along with recent sales and rent comparables.

Steve Morris | Vice-President
IMG Northwest
1234 SW 18th, Suite 102
Portland, OR 97205
Phone: 503.970.4593 
steve@imgnorthwest.com | www.imgnorthwest.com
OR License # 200202054 | WA License # 24512

 


Portland Apartment Sales – Sept 18

26 October 2018
Leave a Comment

To download the individual sales report, right-click the link below and “Save As”:

<<<Portland_Sept18vsSept17_AptSales>>>

Highlights:

  • Gross sales dollars Sept 18 YTD = $1527M is a 44% INCREASE over Sept 17 YTD = $1060M
  • $/unit Sept 18 YTD = $190K is a 11% INCREASE over Sept 17 YTD = $171K.
  • $/SqFt Sept 18 YTD = $222.34 is a 14% INCREASE over Sept 17 YTD = $195.55

We had a stronger month vs. Sept 17 due to several large sales.  Including all sales, we are at a run rate of $2.1B in annual sales rate (vs. $1.7B for 2017 and $2.95B for 2016).  Interest rates and strength of the rental market in Portland (especially for new construction) are the biggest threats.

If you’d like more information on:

– 2012-2017 Portland Apt Market history.  Is posted at 

https://portlandapartmentsales.com/2018/03/22/portland-apt-market-2017-annual-report/

If you like numbers, you’ll find this recap of the market for the past 5 years of interest.  You can eMail me for a copy also.

– Free financial analysis of your property, eMail/call me for a SAMPLE report.  It will be helpful if you’re making decisions about futures or operations and includes I&E comparison to neighboring properties along with recent sales and rent comparables.

– Details/background on individual sales in the report or a breakdown by neighborhood

– Free copy of our 80-page book – Buying, Selling and Operating Apartments Using Financial Analysis

Please contact me:

Steve Morris | Vice-President
IMG Northwest
1234 SW 18th, Suite 102
Portland, OR 97205
Phone: 503.970.4593 
steve@imgnorthwest.com | www.imgnorthwest.com
OR License # 200202054 | WA License # 24512

For the Oregon Real Estate Agency Pamphlet click here.
For the Washington Real Estate Agency Pamphlet click here. 


Portland Apartment Sales – Aug 18

27 September 2018
Leave a Comment

To download the individual sales report, right-click the link below and “Save As”:

<<<Portland_Aug18vsAug17_AptSales>>>

Highlights:

  • Gross sales dollars Aug 18 YTD = $1355M is a 43% INCREASE over Aug 17 YTD = $950M
  • $/unit Aug 18 YTD = $190K is a 11% INCREASE over Aug 17 YTD = $171K.
  • $/SqFt Aug 18 YTD = $2216.87 is a 10% INCREASE over Aug 17 YTD = $197.19

We had a stronger month vs. Aug 17 due to several large sales.  Including all sales, we are at a run rate of $2.0B in annual sales rate (vs. $1.7B for 2017 and $2.95B for 2016).  Interest rates and strength of the rental market in Portland (especially for new construction) are the biggest threats.

If you’d like more information on:

– 2012-2017 Portland Apt Market history.  Is posted at 

https://portlandapartmentsales.com/2018/03/22/portland-apt-market-2017-annual-report/

If you like numbers, you’ll find this recap of the market for the past 5 years of interest.  You can eMail me for a copy also.

– Free financial analysis of your property, eMail/call me for a SAMPLE report.  It will be helpful if you’re making decisions about futures or operations and includes I&E comparison to neighboring properties along with recent sales and rent comparables.

– Details/background on individual sales in the report or a breakdown by neighborhood

– Free copy of our 80-page book – Buying, Selling and Operating Apartments Using Financial Analysis

Please contact me:

Steve Morris | Vice-President
IMG Northwest
1234 SW 18th, Suite 102
Portland, OR 97205
Phone: 503.970.4593 
steve@imgnorthwest.com | www.imgnorthwest.com
OR License # 200202054 | WA License # 24512

For the Oregon Real Estate Agency Pamphlet click here.
For the Washington Real Estate Agency Pamphlet click here. 


Portland Apartment Sales – July 2018

31 August 2018
Leave a Comment

To download the individual sales report, right-click the link below and “Save As”:

<<<Portland_July18vsJuly17_AptSales>>>

Highlights:

  • Gross sales dollars July 18 YTD = $1092M is a 44% INCREASE over July 17 YTD = $759M
  • $/unit July 18 YTD = $189K is a 13% INCREASE over July 17 YTD = $167K.
  • $/SqFt July 18 YTD = $222.62 is a 15% INCREASE over July 17 YTD = $194.15

BESIDES TWO LARGE SALES – We had a weak month vs. July 17.  Without these, we’d be at $61M gross sales for July 18.  Including all sales, we are at a run rate of $1.8B in annual sales rate (vs. $1.7B for 2017 and $2.95B for 2016).  Interest rates and strength of the rental market in Portland (especially for new construction) are the biggest threats.

The $206M sale will probably be about 11-12% of total year gross sales for 2018.

If you’d like more information on:

– 2012-2017 Portland Apt Market history.  Is posted at 

https://portlandapartmentsales.com/2018/03/22/portland-apt-market-2017-annual-report/

If you like numbers, you’ll find this recap of the market for the past 5 years of interest.  You can eMail me for a copy also.

– Free financial analysis of your property, eMail/call me for a SAMPLE report.  It will be helpful if you’re making decisions about futures or operations and includes I&E comparison to neighboring properties along with recent sales and rent comparables.

– Details/background on individual sales in the report or a breakdown by neighborhood

– Free copy of our 80-page book – Buying, Selling and Operating Apartments Using Financial Analysis

Please contact me:

Steve Morris | Vice-President
IMG Northwest
1234 SW 18th, Suite 102
Portland, OR 97205
Phone: 503.970.4593 
steve@imgnorthwest.com | www.imgnorthwest.com
OR License # 200202054 | WA License # 24512

For the Oregon Real Estate Agency Pamphlet click here.
For the Washington Real Estate Agency Pamphlet click here. 


Should I Self-Manage? – Questions

14 August 2018
Leave a Comment

I own apartments and get asked if this is something I should do.  Instead, I think it’s better if you review what a property manager does and then determine if this is something you want to do.

Plusses:

  • Cost savings – Each situation is unique, but for a market-rate property, you’re probably looking at saving 8% of gross income (13% for LIH due to compliance paperwork).
  • Consistency – You’ll be there from the time you buy it until you sell it.  That is, no rotation of staff.
  • Control – Since you’ll be more involved, you can watch expenses like maintenance closer.  This assumes you’ll have a property management program that can track account receivable and payable with some degree of precision.

Minuses:

  • Changing rules – Portland is gaining a discomfiting expertise in creating new rules.  PMs, as part of their job, keep updated on all of this in addition to existing fair housing laws.  As a landlord, if you go to court (e.g. a FED), you may not even get one mistake and tenants are usually allowed a lot more latitude.
  • Marketing – Half of the tenant’s interest is still from drive-bys.  Is someone onsite to greet them?  Having a show of presence also serves as a check on bad behaviors by tenants and keeps your property attractive to tenants.  Can you do ongoing rent surveys to make sure you’re at a competitive price?
  • Recruiting tenants.  A PM will have more advertising than a CraigsList ad, including WEBsites, signage, print magazines.  They should also have a system to track applicants for feedback to you.
  • Liability shield – Having a state-licensed operator as the first contact makes it safer for you and reduces your liability exposure.
  • Handling Emergencies.  Tenants can call at any time for even minor annoyances.  With a tightening market, your response affects perceptions
  • Handling CapEx – Usually contracted out, but doing things in a timely manner works in the long run.  Waiting on moisture invasion issues only makes them more expensive
  • Handling maintenance – Once you get >50 units, you probably need staff to handle this.  The tendency of owner-operators is usually to delay maintenance.
  • Turnover – Can you do this in a timely manner?  With a tightening market, downtime may mean lost opportunity.
  • Accounting – While interfaces like AppFolio are making this easier, someone needs to do data entry and bill-paying.  In addition, a good accounting system can serve as a forensic device to find out where you not making money.  IF YOU CANNOT MEASURE INCOME & EXPENSES – YOU CAN’T MANAGE THEM.

I’m not discounting 3rd party management, however, for most owners, the 10%+/- cost is probably worth it.  However, you shouldn’t abdicate all of your responsibility in managing.  If your main concern is the size of your monthly check, you are probably missing income.

This means you need to understand where your rent money is going.  Sitting with your manager and setting goals (i.e. what are the 3 things we’re going to do this month to increase NOI), gives them guidance, help you understand what issues are with your property and defines what stops you from making more money.  The value of your apartment (whether you hold or sell) is directly related to your NOI.


Portland Apartment Sales – June 18

26 July 2018
Leave a Comment

To download the individual sales report, right-click the link below and “Save As”:

<<<Portland_June18vsJune17_AptSales>>>

Highlights:

  • Gross sales dollars June 18 YTD = $793M is a 30% INCREASE over June 17 YTD = $612M
  • $/unit June 18 YTD = $186K is a 13% INCREASE over June 17 YTD = $164K.
  • $/SqFt June 18 YTD = $226.71 is a 23% INCREASE over June 17 YTD = $185.10

We had a weak month vs. June 17.  At $83M gross sales we are at $1.5B in annual sales rate (vs. $1.7B for 2017 and $2.95B for 2016).  Interest rates and strength of the rental market in Portland (especially for new construction) are the biggest threats.

If you’d like more information on:

– 2012-2017 Portland Apt Market history.  Is posted at 

https://portlandapartmentsales.com/2018/03/22/portland-apt-market-2017-annual-report/

If you like numbers, you’ll find this recap of the market for the past 5 years of interest.  You can eMail me for a copy also.

– Free financial analysis of your property, eMail/call me for a SAMPLE report.  It will be helpful if you’re making decisions about futures or operations and includes I&E comparison to neighboring properties along with recent sales and rent comparables.

– Details/background on individual sales in the report or a breakdown by neighborhood

– Free copy of our 80-page book – Buying, Selling and Operating Apartments Using Financial Analysis

Please contact me:

Steve Morris | Vice-President
IMG Northwest
1234 SW 18th, Suite 102
Portland, OR 97205
Phone: 503.970.4593 
steve@imgnorthwest.com | www.imgnorthwest.com
OR License # 200202054 | WA License # 24512

For the Oregon Real Estate Agency Pamphlet click here.
For the Washington Real Estate Agency Pamphlet click here. 


Appraisals – Why, What and How?

26 July 2018
Leave a Comment

When we have a well-informed buyer and seller agreed on a price why/when do we need an appraisal and what goes into one?

Why do appraisals exist:

  1. Usually at the request of a 3rd party like a lender who needs to assure (their shareholders) a property in their portfolio has “true” value.
  2. Part of the sales agreement.  Sometimes an appraisal is used to set the price or (like most sales contracts) there is a clause stating a sales price must “meet or beat” appraisal.
  3. Risk-averse buyers – Governmental or non-profits chartered with the stewardship of public funds or donations in a prudently need to ensure they are paying a “fair” price for an asset.

An appraisal is an estimate of value made by an objective disinterested (i.e. neither in favor of the buyer or seller) party and considers multiple market factors.

What does an appraiser look at to establish real-world value?  The object is to see if there is an “average” value of a similar property that has been recently purchased.  They do this by looking at:

  1. The operating numbers, condition and current use (i.e. can it be repurposed and bring higher value) of the property.  This is used to determine a rate of return since commercial property is bought for investment purposes.
  2. Comparable sales of similar properties to normalize/adjust pricing of the appraisal.

What makes a property “comparable” to the appraised property?

  1. Proximity to appraised property (location makes a big difference in value).
  2. Condition of the property (does it need a lot of CapEx just to make it average) will affect sales price.
  3. AgeThe average 70s vintage property sells for the min $/unit compared to other decades.  [cf. The 5-year Portland sales history (on this WEBsite)]
  4. SizeYou have different types of buyers dependent on property size.  Smaller buyers may place aesthetics over investment return.
  5. Unit mix – Comparing an apartment with all studios vs. one with all 3 bed units is not representative.

Whether for an appraisal, your investment return or max sales price, you need to keep your property in good shape (for buyer/tenant appeal), stay on top of maintenance and maximize your NOI.

Steve Morris | Vice-President
IMG Northwest
1234 SW 18th, Suite 102
Portland, OR 97205
Phone: 503.970.4593 
steve@imgnorthwest.com | www.imgnorthwest.com
OR License # 200202054 | WA License # 24512

For the Oregon Real Estate Agency Pamphlet click here.
For the Washington Real Estate Agency Pamphlet click here. 


Next Page »