Dear Landlords and Investors,
The principles of leverage, supply, demand, and ROI still push appreciation. San Diego has proven to be a wise location for your investment dollars. But, don’t become complacent. Don’t lose track of why you are investing, regardless of how successful you are. Dealing with unexpected issues can make or break your business. So of course, you’re right to want to understand how the current market affects your property values. You deserve expert guidance. Here are details on what you need to know now:
No Slow Down or Softening in San Diego’s Multi-Unit Market
Sales of residential properties have slowed in June. Following a steady increase since the beginning of the year. BUT, the 2-4 unit market in SD is still pushing forward!
The average sales price is up 20% from June of last year! Even though days on the market increased 9 days over last year. The 2-4 unit days on market stat has remained fairly consistent throughout the year. Around 30 days.
The sales-to-list price ratio has stayed fairly consistent as well. Hovering around the 97% mark since January.
No surprise here… We’ve seen the biggest movement with the average sales price and price per door. Both stats have experienced a slow but steady upward trend. At the beginning of the year January’s average sales price was $1,293,964. As of last month, June of ‘24 the average sales price was $1,631,354. A 23% increase since the beginning of the year.
The price per door in January was $483,921. And as of June, your average price per door is now $573,786. An increase of 16.99% in just the last 6 months.
What can we equate this to? The age-old roll of supply and demand. You have the natural expansion of the buyer pool here. Coupled with investors entering into the market for the first time. And on top of that, there’s been an explosion of seasoned flipper type of investors. They’re out there snatching up tired old units. Going in and revitalizing them. And in the process adding more units to each property or lot. We’re seeing this trend all over San Diego county right now.
Lyle and I have been in the streets over the past few days. We’re out and about searching for leg-up properties for our investors. Especially those who have owned their properties for over 27 ½ years. Because their depreciation allowance has expired. They need to start that clock all over again. Also looking at properties for our first-time investors. Many want solid properties that are easy to manage and maintain. Ones they can step right into and learn the ropes.
We narrowed down a list of over 100 to these 5! Here’s the link to the video we shot for them.
Bet the results will shock you! Not only by the rental income these places are bringing in. But you’ll see exactly what these savvy investors are doing to the older properties. All because of the zoning law changes that were recently passed. They’re able to add tremendous value to these properties. Doubling, and in some cases, tripling property values. All by adding extra units and creating off-street parking. Plus adding improvements tenants are willing to pay extra for. Things like modern finishes, in-unit laundry, private patios, or landscaped communal open spaces. We’re even seeing solar charging stations for vehicles.
Things are changing in the 2-4 unit market here in SD! The new wave of investors are here to stay. Modernizing properties all over the county, one at a time.
Current Market Rental Values In An Instant
You know by now, just how important it is to keep your rental values current. Not doing so is bad business. It reduces the value of your property when it comes time to sell.
With that in mind, we’re excited to share some great news! Recently, we invested in software that is going to be a game changer for YOU. This will save you a ton of time, energy, and research!
Now we can help you analyze your rental property estimates with ease. Anywhere in the nation. Over the past month or so we’ve been using this new software. Assisting our clients with quick rent estimates. These quick-view rent estimate reports include average and median rent prices. Here are several examples of how we’ve put this software to work.
Our clients were in disbelief about what the 2 brand new units were bringing in. It was on a recently renovated 4 unit building. Currently listed for sale in North Park. They asked us to double-check the current market rental value. In particular for new construction units. No problem!
We did the same thing for a hard-to-price-out duplex that’s on the market up in Bonsall
Another client feared her that 2 bedroom, 1 bath condo in Escondido was being rented way under current market value. And she was right! About $500 under what she could be getting.
And the details we can get you with this report are incredible! Check this out:
RECENT FAQ’s FROM CLIENTS LIKE YOU
What’s the depreciation allowance for 2-4 unit property owners? And why is it beneficial?
The depreciation allowance lets you deduct the cost of your 2-4 unit property over time. Simple, because buildings wear out. For residential rental properties, like 2-4 unit buildings. IRS says you can spread the cost over 27.5 years. This means each year you can deduct a part of the property’s cost on your taxes.
This is beneficial because it lowers the amount of income you have to pay taxes on, which can save you money. For example, if your building costs $275,000, you could deduct $10,000 each year for 27.5 years. This helps reduce your tax bill and can make your investment more profitable.
*We can not provide you with tax, accounting, or legal advice. Please check with your tax, legal, and accounting professionals. Ask them how this would apply to your situation.
KEEP YOUR QUESTIONS COMING! We love hearing from you. And we plan on answering your questions monthly moving forward. It’s important that you’re informed and educated about what you buy and why you’re buying it.
AND WHEN YOU’RE AT THE END OF THE GAME… READY TO RETIRE FROM LAND LORDING?
Let’s face it. Being a landlord has its ups and downs. If we had to point you in one direction it would be the Delaware Statutory Trust folks. And here’s why. With the DST, you get all the benefits of ownership. Without the hands-on day-to-day dealings of tenants and property management/maintenance. Plus it provides you with cash flow. And in a lot of instances, it’s even more than the relinquished property provided. Second of all, you’ve got professional management and bookkeeping. It’s automatically done for you. We’ve touched on DST options in the past. Don’t be shy, contact us.
Bookmark-Worthy Links
San Diego Real Estate YouTube– Weekly Videos Keep You Connected
Rentometer-House and Apartment Rental Rate Comps
HomeBot-Personalized Home Finance Tool
ALTOS Reports -Powerful Data-Driven Real-Time Zip Code Market Updates
MLS Access for Investment Property -Custom Searches For Investment Property
San Diego Apartment Investors Market Report Archives-Access Past Market Reports
IT’S TIME FOR YOU TO GET THE ROI YOU DESERVE
You’ve worked hard for what you’ve earned, and you’re right to want the best experience. Be confident you have professionals on your side. We use ROI-based marketing. Rest easy knowing we use an organized system to market your property. Employing our highly targeted and proven approach like no one else is what you deserve!
Thinking of selling your property in the next 12 months? Call us today for your strategic marketing consultation at 858-218-4511.
