Jennifer Athas, Boston Herald HomeSmart Contributor, on Competition from Buyers for Multifamily Properties

Well you know to take a look at the jobs numbers. Be similar to -- To say too weak report would be like saying the Titanic had a little bit of -- week. It was a bad report that came up this morning at 830 know no way around it and as a result. Futures are negative territory across the board Dow futures down about fifty points we're joined now by Jennifer pass over at the Boston Herald Jennifer welcome to the financial exchange Terry to a good morning great -- you know I wanted to kind of have the same conversation you and I had about. Multifamily real state earlier in the week I'd -- to have that conversation of their listeners today. Tell us about the multifamily real estate market in the Boston area inside 120. Grade point out the part of the multifamily sizes we're talking about are usually -- -- four. Properties they're not large multifamily yup. And what we're they have written a lot of activity right now -- we're seeing with -- -- listing activity from. The owner occupants of -- but and they. And we're seeing it from investors -- to get to buy and hold because of the net because of this strong rental market in this and the market. How many of multifamily properties are on the market right now Jennifer. Right now in Boston -- 210 multifamily. And how does that compare to previous years. Last year you know we're down 18% from last year. What are prices doing. You know -- -- are pretty much flat. And I think the reason why one of the reasons why is because of the inventory. You know we're seeing inventory that's a lot less you know about twenty person you know they say it's 20% less the break is there's so flat ground eventually I think we're gonna be -- -- Who's buying them who they who's by Andy's multifamily is that developers is it to a young college kids -- you -- a young families that are Bynum insane. Hey we wanna buy and rent out to the units and live in one area with what's the deal. You know I think that you have all re sort of buyer profile very strong in the market now were previously had a lot of investors immediately to. Owner occupancy have all three. In their -- competing against each other. -- how many cash buyers we've seen -- isn't a larger number than normal. Absolutely right now Boston is about 40% cash higher year to date. Is that just on the multifamily that over across the board. That's across the board which is you know it's never been. Why is it's -- high. It's never been that high at all price point you know I think it's I think it's a lot to do with the demographic it a lot of baby boomers. You know in the market right now and it's a lot of cash. So what do they do they sell their house up in the verbs and -- and in town. Don't know how if they're they're giving it you know it has 31 exchange where they're prepared you know upgrading their -- getting rid of one you know income property in upgrading to mr. about higher and higher class and some property. Talk about 1031 exchange a little bit because that may be flying over the head of some of our listeners. 81031 exchange allows. Easy a property owner who might own some land or commercial property gets increased in value. To avoid the taxes -- avoid the capital gains and they were -- depreciation taxes is that correct. Would it what are the rules associate that. Well basically you know there's. The concept -- -- that -- you hated it but you know you basically have to take you know one investment property and in invested in another. Com income property within a specified timeframe and I think it's about sixty days you have to identify the second you know your next. Internet properties so you know when you -- -- -- you you have it under contract. Figuring that pretty much tight timeframe to find your next property -- inventories well you know you stated. -- you know you're running out of options. Is it is that what you attribute the high demand to. Part it partly is the 1031 -- activity. You know I think it's I think that's definitely a part of it I think that he had three things -- -- to 1031. Activity. You have to be. You know in the low interest rates and the -- you know and it really makes sense for first time respective time home -- to buy you know at three family or even at his family and have a rent you know help pay the market -- And then you have a lot of investors that have been renovating 23 and four family homes. And doing pretty well. B -- seen any bidding wars is demand high -- up we've seen properties go perhaps over the asking price. Yes yes we have and -- and I think the reason why is. The value of a property is worth more to somebody who hold them longer Mercer and it's worth more to the owner occupy. And it -- for the contractor who's been there you know for a few months and and down and in a converted to condos. You have these owner occupants -- of these properties and they're typically not cash buyers they usually getting alone. And their competing against the contractor or investor who we cash they have you know three different groups with three different it will hold a different values to the property. About it. Our it would Jennifer I appreciate your time thanks for joining us on the financial exchange. As Jennifer a pass from from the Boston Herald giving us an update on the Boston Real Estate market sounds like things are eaten up to. Yet to Disco hits than it is for those of you who are selling your property is not so good news for those of you work trying to buy guns and that's the word pretty much from everybody that we talked.