Apartment Investor's Advisor December 2009 EZine

Katherine J. Higgins

The Market Leader in North Bay Apartments

Investment Broker

Bradley Real Estate - Luxury Division

(415) 721-2595 office

(415) 302-7730 cell

(415) 721-2596 fax

851 Irwin Street, Suite 104

San Rafael, CA 94901

www.khiggins.com

Apartment Investor's Advisor

December 2009 EZine

Dear Marin County Investors,

A year end recap of the apartment market indicates that this has been one of the toughest in recent memory. Many well located properties being offered are still on the market as buyers and sellers look for a meeting of the minds on pricing and returns. Those few properties that have sold this year were the result of either distressed circumstances or properties that were free and clear and sellers wanted to trade up and look for another investment opportunity.

The most positive aspect of the market in the past six months is the increased activity and buyer interest. The first six months of the year, with fears of bank failures and high unemployment, investors sat on the sidelines. Now with the economy stabilizing, investor confidence is returning, and buyers are in the market.

Pricing on apartments in Marin has stabilized and we are seeing GRM's on B and C properties at around 11.5-12. This will produce a 6 cap. On better locations from San Rafael to Southern Marin, GRM's are at up to 15-16 depending on the number of units and amenities offered. Of course, views, fireplaces, nice units and no deferred maintenance are the most attractive to many investors.

Apartment financing is still plentiful in the County, with many local lenders offering rates on 5/1's at 6-6.5%. The local apartment lenders most active in today's market are First Federal of San Rafael, Bank of Marin, Circle Bank and Luther Burbank Savings and Loan. These lenders will loan up to 65% LTV or more, depending on the location and income of the asset.

The return of the exchange buyer is a third positive aspect of the investment market, with many existing income property owners electing to trade their equity up for increased cash flow. The tax deferred exchange allows property owners to trade up to a larger property with no tax on the gain.

The outlook for 2010 looks extremely promising as the economy continues to recover and rent increases and increased cash flow will soon follow.

Have a happy holiday!

Regards,
Katherine J. Higgins

Marin County Investment Broker
Since 1986
Mobile: (415) 302-7730

Below are my current offerings. Please call my office at (415) 302-7730 if you have an interest in any of them.

You can also visit my website at www.khiggins.com.