Phoenix Fourplex Apartment Market for 2008

Just as the residential market has seen a decline in prices and a decline in sales, so has the small income property market.  Mostly, besides being a supply and demand matter it's the financial market that has put the investment market on the decline, at least for now.

In Greater Phoenix the sales have dropped dramatically from 43 in April 2006 to 10 in April 2008.

Besides that the price per unit has decreased from $89,873 in 2006 to $86,401 in 2007 and $59,525 in 2008.

	Jan.	Feb.	March	April
2006	44	47	50	43
2007	18	23	21	24
2008	7	6	19	10

In Phoenix sales have dropped as well from 15 in April 2006 to 3 in 2008.  The price per unit decreased from $96,293 in 2006 to $79,368 in 2007 to $53,368 in 2008.  That's a dramatic decrease in the price per unit.

	Jan.	Feb.	March	April
2006	16	21	24	15
2007	6	17	10	17
2008	1	0	12	3

What do all the numbers mean?  Well the decrease in price per unit is indicative of the difficult market.  It's not necessarily the same buildings selling for much less, but sometimes it is; its that just as with single family homes, people got stuck either with bad properties or with unreasonable loans. 

There were many speculators in the multifamily market.  Some of these speculators got the same loans as home owners and when the rates adjusted the rent could not cover the payments, and management became more difficult or was not considered even when the property was purchased.  Thus, we have a glut of low priced foreclosed or short sale apartment buildings that are skewing the price per unit lower. 

Most investors that have good properties don't need to sell. This is also one of the reasons it difficult to find top grade fourplexes for sale, though there are some.

For sellers of small multifamily properties the market is very competitive.  There are currently 357 fourplexes for sale in Greater Phoenix while only 42 sold during the first 4 months of 2008.  That is a 34 month supply; a very large supply, but a great opportunity for buyers, especially those that are in it for the long term.

Let us know if you would like to find out more about purchasing a small income property in Phoenix, we're not only agents but investors ourselves.