{"id":3665,"date":"2023-05-31T18:11:30","date_gmt":"2023-05-31T18:11:30","guid":{"rendered":"https:\/\/www.coastalcapital.com\/?p=3665"},"modified":"2023-05-31T18:18:49","modified_gmt":"2023-05-31T18:18:49","slug":"may-latest-updates-insights","status":"publish","type":"post","link":"https:\/\/www.coastalcapital.com\/may-latest-updates-insights\/","title":{"rendered":"May Latest Updates & Insights"},"content":{"rendered":"\t\t
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COASTAL CAPITAL INSIGHTS<\/span> <\/h1> <\/div>\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t
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Each month Coastal Capital strives to bring you the latest updates and insights into the California real estate market for both investors and brokers.\u00a0 We always welcome new investors who enjoy above-average returns that are not correlated to the equity markets.\u00a0 As always, we appreciate both new investor and broker referrals, as the network builds it brings more value to all through diversification.<\/span><\/p>

Please note that you can add on to your existing investment in any amount.\u00a0 While an initial investment requires an investment of $100,000; existing partners in the Fund can add on in any amount from $2,500 or more.<\/span><\/b><\/p><\/div>\n\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/section>\n\t\t\t\t

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MARKET UPDATE<\/span> <\/h1> <\/div>\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t
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Low, low inventory levels of single-family residency & multi-family homes continues into this Spring selling season (which is historically the busiest time of the year) for real estate agents.\u00a0 As of May 6, the inventory of single-family homes for sale statewide was at 26,627 homes, slightly below where it was exactly a year ago (26,994 homes) and well below early May 2019 inventory levels, which came in at over 60,000 homes, according to data from Altos Research.\u00a0 We are seeing this trend across markets south of the Bay area and at all price levels.\u00a0 Entry level homes less than $750,000 are being snatched up quickly if priced within reason.\u00a0 In the Bay area the social issues of homelessness, crime and exodus of tech workers has hit the area hard and inventory is flowing as people leave to greener pastures of California (Coastal Capital has pulled back significantly from the area in 2022 with only one trust deed in the area.)<\/span><\/p>

\u201cIt is very different from what we saw in the fall,\u201d Ryan Lundquist, a Sacramento County-based residential real estate appraiser and market analyst, said. \u201cIt is like the market went from an ice bath to a blood bath \u2014 it is very competitive, and buyers are feeling frustrated at the lack of options.\u201d<\/span><\/p>

And it appears that the low inventory situation won\u2019t be ending any time soon, as the number of new listings coming to market is also well below where it was last year. During the week ending May 6, 4,942 new listings of single-family homes came to market in California. A year ago, 7,684 new listings came on the market during the same week, and in 2019, 8,188 new listings were added, according to Altos.\u00a0 We predict the current Seller’s Market will continue for the near- and mid-term.<\/span><\/p><\/div>\n\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t

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Source: Altos Research<\/p>

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The theme of high rents throughout California continues. While the rental rates are no longer sky rocketing, they are holding steady and creeping up. The ROI for landlords continues to drive the demand for multi-unit buildings. Young Californians won\u2019t be surprised to hear that homeownership rates are declining in their age group. Now a new study from Terner Center for Housing Innovation from UC Berkley finds that on average, it takes longer to become a homeowner in California than in any other state.<\/p>

The point when half of Californians at any given age become homeowners is 49, according to the study. That exceeds other expensive states like New York (46), and it\u2019s much higher than many of the states Californians have been flocking to, such as Texas (37) and Arizona (35). The study finds that in 1980, almost two-thirds of Californians aged 35 to 45 owned a home, but only 40% of residents in that age group owned a home in 2021.The same trend is happening among younger age groups. About 40% of Californians aged 25 to 35 owned a home in 1980, but only 16% in that age group own homes today.<\/p><\/div>\n\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t

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Source:\u00a0<\/span>Terner Center for Housing<\/span><\/a><\/p><\/div>\n\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t

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Without new building starts or a massive migration exiting California we expect that landlords will continue to make up a majority of our application volume, especially in Southern California from Santa Barbara to the Mexican border.\u00a0 The light commercial and industrial markets continue to chug along as normal.\u00a0 Our applications desk has seen an uptick in deal flow in this segment.\u00a0 We feel this segment of the marketplace is normal except for office space which continues to struggle as workers fight their employers on returning to the office.\u00a0 This month we did fund our first commercial deal at an incredible LTV.<\/span><\/p>

Small business owners are turning to private money lenders for their business-purpose loans in droves.\u00a0 Banks with all the recent failures are hoarding cash and the last person they want to loan it to is someone who is self employed without significant assets.\u00a0 The availability issues of conventional financing is really increasing demand for our trust deeds in this segment.\u00a0 Across all markets in California for private mortgages & trust deeds we are seeing elasticity in rates that borrowers are willing to accept ranging from 12% to 14%-plus.<\/span><\/p>

Thank you for all our existing partners who have been referring over friends & family to join us.\u00a0 Just a reminder that initial investment amount requires $100,000; existing partners in the Fund can add on in any amount from $2,500 or more.<\/span><\/p><\/div>\n\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/section>\n\t\t\t\t

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PORTFOLIO HIGHLIGHT<\/span> <\/h1> <\/div>\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t
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Just when we thought we had seen every possible scenario a new one came across our desk. A local real estate office in Modesto, California took over a church and paid cash for it to transform into their offices. They needed just a little bit of financing to finish the interior renovations but even with perfect credit they found it difficult to find a cooperative lender given the uniqueness of the property.\u00a0 While not a typical deal structure, Coastal Capital immediately understood the equity position and provided the broker with a quick solution!<\/span>.<\/span><\/p><\/div>\n\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t

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