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Tuesday, October 19, 2010

Housing Slump Offers Opportunity In Apartment-Building Market

Please note this is for out of California
"The pain was concentrated where we had gross overbuilding in overall housing: Florida, Phoenix, Las Vegas, Southern California, and to some degree smaller markets like Tucson, Charlotte and Atlanta," says Badji.
Marc Solomon, whose Solomon Organization owns 10,000 garden apartments in New York, New Jersey, Connecticut and Pennsylvania, says that it is difficult to find opportunities that make good business sense in his markets, which still offer slow, steady returns. "There's a lot of dollars out there chasing these deals," he says.
One of the reasons
"I don't think you're going to get fire-sale prices," he says. "But you can get that kind of return ahead of the job growth and ahead of the economic recovery."
Rental occupancy rates contracted dramatically during the recession, as people doubled up to save money and young adults boomeranged back home. Vacancies nationwide hit a high of 8 percent in the last quarter of 2009, according to real estate research company Reis.
But industry insiders argue that rentals will bounce back quickly and dramatically as well. Indeed, in the third quarter of this year, vacancies dropped to 7.2 percent, according to Reis
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