(Graph by: PhoenixMarketTrends)

We’re currently revamping Arizona Apartment Investor into a new design, actually it’s been in the works for a while: until it’s completed shortly some updates will be located at PhoenixMarketTrends.com, like the most current look at the triplex and fourplex market in Greater Phoenix.  I chose only triplexes and fourplexes because I happen to like this size, it’s easy to buy and sell: it can be done so via a residential loan like FHA, VA or conventional, these are purchased by investors and owner occupant/investors and they are a good gauge of the small multifamily market.

Please continue reading here.

The Phoenix real estate market seems, to many, to be a bargain basement store where the owners of the store have no sense or are giving things away.  It’s not.  And, that is what cover in the article, 15% Return Cash on Cash On Phoenix Real Estate.  High returns are possible, but not with little or no input from the investors.  It is as it always was, the more astute investors get the better deals, which most educators don’t teach you.

The article, The Greater Phoenix Population Is Moving, Most Of It Down The Street, To The Home Next Door. covers how the population of Greater Phoenix is moving but simple within the same neighborhood from one house which is being sold short or going into foreclosure to another often one purchased by an investor.

There has always been some interest from people who want to combine the need for shelter and investment with purchasing a fourplex.  In the article, Where Are The Triplexes and Fourplexes More Suitable For Owner Occupants in Phoenix, I gripe a little bit and explain whey the choices for owner occupants are so limited.

Investors in small multifamily properties, 2-4 units, have a window of opportunity now and for at lease another 6-12 months.  Prices are very attractive and there are many options where cash flow can be substantial.

What is difficult is financing.  You need that 20-25% down plus healthy reserves and very solid credit, plus not more then 3 other leveraged properties.

The larger properties 5+ units and especially mid sized and larger properties with commercial financing will have that window open up in the coming year as loans come due and are unlikely to be renewed.

At the same time it will be difficult to finance these properties, though cash buyers will be in a very good position to buy well positioned properties.

It’s a new year, 2009. 

I truly believe that all of us have it good in this time in this place.  We all go through our own individual lives with the good and the bad but, as a society, as as beings we have never had it so good. 

A hundred years ago the simplest things today were luxuries, communication was scarce and knowledge was limited and medicine still in it’s infancy: literacy was lower, life expectancy was shorter and so on.  Not long ago what the most of us have now only the wealthy had, if that.

Each year the world gets better, people have more opportunities and – I believe – more consciousness.  It is really up to us, individually to realize our dreams: there is very little in the way.  So welcome to the best year yet!  Make it your best year!

Sales of small multifamily properties are on the rise especially over last year.  23 sales may not seem like much but it’s 65% higher then last year.  Still the prices are down significantly.  This is mostly due to the abundance of foreclosed and pre-foreclosure properties that have sold or are for sale. 

The first chart shows total volume in dollars and the average per property.  More units but for lower prices.  This is not good for motivated sellers but it’s really good for buyers who can buy properties with strong cash flow.  I have seen properties in good areas with a 14 Cap rate in good areas.  A client calls such areas the "arm pit of a neighborhood" and these are often good buys: weak properties in a strong neighborhood, that is.

The chart below shows inventory levels, new listing and sales of 2-4 unit properties in Maricopa County.  This is further broken down in the second chart below. 

Despite the increased sales inventory, while down, sill is high.  There was an inventory of 597 properties: 104 were new to the market.  Each month we add some 100 properties to the market, 4-5 times the sales.  So where are these properties going?  Some are sold but many are removed from the market, some are recycled – changed agents – and others go into foreclosure.  It’s not pretty out there but it’s beautiful for buyers in a strong financial position, those with access to financing and/or cash.  Some of these would make great owner occupied properties allowing one to live nearly for free.

 24 multifamily properties sold in September in Greater Phoenix.  This is data from the ARMLS.  It does not include large properties: it’s mostly 2-10 unit properties.   The graph dispalys 20 becasue there were a few last minute closes after the graph was generated.  The previous numbers are correct. 

Of the 24 sales, 5 were normal:  that means sales directly with the owner.  2 sales were short sales and the rest 17 were lender owned or REO sales.  Prices started at $20,000 per unit and went up to $73,750 per unit and that was for a pretty attractive property thouh in not the best area.

There is no doubt that we are in the new "cash flow economy" where investors don’t count on appreciation for any investment gains, but cash flow and it’s the cash flow that is truly builds financial freedom.

The Phoenix Light rail, which will go through Phoenix, Tempe and Mesa, start up is just around the corner.  Before years end on December 27th 2008, it will roll through 3 major cities, through areas with increasing populations and lots of development and redevelopment.