Hey guys, it’s Eric with Central Valley Property Advisors.
Today I wanted to quickly go over appraisals and kinda what I’ve been seeing.
We’ve been having appraisals come back a little light. We’re seeing cap rates start trading around six, six and a half again so were talking pre-pandemic levels of where stuff is trading in the multifamily market.
I know a lot of people are saying you know, prices are coming down everything is going to crash.
What I’m seeing now from a few of the appraisals that we have gotten back it’s that it’s not really crashing but it’s becoming more stable from what we had seen before the pandemic, which is going to create a good healthy market in multifamily in Bakersfield.
We still have a ton of people calling us weekly, daily, trying to get into the market from exterior markets.
So the demand is still there but what I am gonna see, what I’ve been trailing, talking to different appraisers is that cap rates are starting to slowly increase due to interest rates that have increased.
Interest rates are still floating right around that six percent.
There some guys trading a little bit lower but if we’re getting a 6% interest rate we need to be getting a six, six and half percent cap rate.
We don’t want to be trading on negative interest like we have been in the past few months.
Keep your guys eyes out.
I think prices are gonna start to stabilize.
We should see the prices come down a little bit as these caps rates are increasing and we are hoping the Fed just maintains a quarter point bumps so we can have a good solid year this year.
