August 2023 Market Data
In August, there were two properties that traded for $1.050M each for a total of $2.1M. The properties were owned by the same owner. The average price per unit of these properties was $131,250 and the average CAP rate was 4.92%. Year-to-date sales through August ’23 was $105.77M compared to year-to-date sales through August ’22 was $132.28M. Total sales volume is has slowed significantly, down 20.02% year over year. Download Sales Comps Below!
Inventory Snapshot
There are a total of 36 properties listed on the market for a total consideration of $127.6M with an average days on the market of 142 days. The median price per unit of the listed properties is $294k and the average CAP rate is 3.78%. Expect to see CAP rates continue to increase as investors look for stronger returns on their investment dollars. The 10-year treasury note is yielding 4.795% and investors’ cost of capital will continue to rise along with the increase in interest rates which is widely anticipated through the end of this year.
Asset Management Tip – Lease Extensions Best Practices
It is important for owners to focus on their operations during uncertain economic times like we’re faced with today. A property’s greatest asset is its tenants. Here are a handful of best practices to ensure that extending your tenants’ leases runs smoothly and helps you to boost your property’s income.
Maintain Great Relationships with Tenants
- Communicate with them regularly, not only when it’s time to renew their lease.
- Listen to their requests or suggestions.
Research Market Rents
- Survey other comparable buildings to determine “market rent.”
- Your property manager can also provide this data.
Set Your Rents According to the Market
- You don’t want to overprice the property or miss out on potential income.
Reach out to Tenants in Advance
- Make contact three months prior to lease expiration and your Tenant’s will appreciate it.
Increase Security Deposits
- The new security deposit should match the new rental rate.
Document The New Terms
- Have the Tenant execute a lease amendment (1 page document)
- Confirm the new rental amount, security deposit, and lease term.
Streamline the Process
- Identify ways that you can simplify and automate the renewal process.
Multifamily In the News
New Affordable Housing Apartment Completed in Makiki
Why Everybody Had to Move Out of This Affordable Housing Project
Micronesian Tenants Fight Back Against Terrible Apartment Conditions
Rents Could Double for Some Ewa Beach Tenants
Fannie Mae Introduces 5% Down Payment Options for Multifamily Homes
Networking Events
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