Right now we’re going to talk about the apartment market and the political landscape. Thanks for tuning in to the Real Estate Today podcast.
I’m Bob Nelson, real estate investment broker with Pacwest Real Estate Investments. I’d like to deal today with the apartment market, residential rental property. That’s my specialty. I’ve specialized in it for … I’m within a month and a half of being 50 years in the business. Some would say, “When are you going to get a real job,” but here we go.
Bob Nelson: Let’s take a look at the apartment market. It is changing. It is changing in several regards. Politically it’s changing in that Portland is now experiencing rent control by a more polite thing. They call it rent stabilization, but it’s absolutely rent control. You cannot increase your rents more than 10% a year, and if you ask somebody to move out, you have to pay them an allowance to cover their moving cost, which is very interesting. As a professional tenant, I could probably not pay any rent whatsoever by being a belligerent tenant, getting kicked out, and being paid to be removed, etc.
Anyway, the long and the short of it, things are changing from a political standpoint. The rest of the state does not have rent control yet. Notice the term yet, but our legislature is famous for edging in that direction. For some of you, it’s like, “Well, wait a minute. I’ve paid my hard-earned money to own an investment that provides shelter to other people who can’t afford to own a property, and I’m being told that I have to do this, and I have to do that.” For some, that’s becoming a little onerous.
So as the market changes, the vacancy factors start to increase, rent maybe starts to roll back to make sure that you’re full, and you’re being told how to do things and when to do it, and if you don’t, you get penalized substantially by the government. Some would say, “It may be a good time for me to go out of ownership of apartments and into a different food group of real estate investment,” and I can do that. I specialize in the 1031, the tax-deferred exchange. That has been my website forever, www.1031guru.com. That’s me.
And you can sell an apartment complex, go through a 1031, a tax-deferred exchange, into, say, triple net stuff. There’s no management, etc. If that is of interest to you, give me a call. I can make some suggestions.
I’m Bob Nelson, real estate investment broker with Pacwest Real Estate Investments.
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