Bubble or not, here we come.
There's a bit of uncertainty that's been brewing for quite some time in commercial real estate. Mainly in the multifamily space to be exact. As rental rates in Los Angeles continue to reach seemingly unsustainable levels, demand continues to rise due to several key factors. Not taking into account an impending rise in current interest rates, the market has already priced in the sometimes higher than mortgage prices associated with rentals.
Who's to say the market doesn't just completely shift in a different direction due to some sort of global economic downturn or localized disruption? We're talking the potential for a substantial deceleration that would put many would be buyers out of reach to investment opportunities. Shred that possible view of making a quick killing while prices are sky high when the winds change. It is imperative that a true investor navigates through the currents and understands when to seize the moment to maximize their profits.
We continue to do more off-market multifamily residential deals in Los Angeles than ever before. The proof is in what you actually find listed for sale. Cramming for a test is probably the best way to compare the stress an investor feels when looking for their next acquisition. The disposition of a property isn't any easier. Yes, the truth is that there is a buyer for everything, but the only way to make two sides meet in the middle is to actually know what's potentially available. Information about a deal remains the most valuable asset to a buyer. Sales are happening every day, and I speak from experience with deal flow.
All it takes is speaking with the right people in the right channels. The deals I'm involved in are only taking place because of the time invested in obtaining the necessary information needed. Do you see yourself waiting for an opportunity to come along? If you're considering selling, would you say you're actually committed to looking at offers? These are the questions I ask on a daily basis to my clientele. Now is the best time to really walk away ahead if you're a seller.
I'd love to hear your thoughts on this and if you want to know more information about what I do!
- Daniel in L.A