For multifamily investors that have their sights on Ventura, looking at the year over year comparison from Q2 2023 to Q2 2024 for this asset class might not show much difference in the performance and outlook for apartments in the area. This seeming lack of change is deceiving, however, as taking a closer look at the T12s for apartments in Ventura reveals the truth behind the performance of this asset class (T12s, for those that might not know, are what is referred to as the “trailing 12 months” of a property, or the last 12 months of financial data on that property).
Rather than looking at Q2 2023 vs. Q2 2024 alone, this report will include data from Q1 2024 for multifamily properties in Ventura, providing valuable context for investors that will enable them to make better-informed decisions on whether to invest in this asset class or not, specifically in the aforementioned market. The table below includes key data points on the performance of these apartments, several of which will be extrapolated in this article.
Unlike some of the other data points from this table, the year over year comparison of the first data point (Occupancy Rate) shows an accurate picture of what is truly going on, even after including data from Q1 2024. Taking a look at the first interval from Q2 2023 and Q1 2024, the rates decreased by approximately 20 basis points (basis points are 1/100th of a percent, or 0.01%; using basis points as a unit of measure eliminates the potential confusion from using too many decimal points). However, since the distance in time from that first interval is nine months, compared to the second interval of Q1 2024 to Q2 2024 being only three months, then the decrease in 20 basis points during the second interval is more drastic than the decrease in 20 basis points from the first interval, since the second interval took place in just one-third of the time. This might suggest that the occupancy rate is decreasing at a sharper rate than from a year ago, which will decrease the NOI of the apartments, and suggests that the overall trend from the beginning of the first interval to the end of the second interval is downward, with the trend looking to decrease at a sharper rate.
The next eye-opening data point is “Total Deliveries (Units)”. The year over year comparison shows a small decrease in deliveries, with 321 in Q2 2023 and 306 in Q2 2024 (“deliveries” refers to the number of units that came online in the market, either new builds or renovated units). Q1 2024, on the other hand, weaseled by with a mere 120 deliveries. What makes this statistic so compelling for investors, however, is the turnaround of 306 deliveries taking place in just the space of the next three months. The rise of new units coming online is creating an oversupply, which suggests a decrease in prices in the near future and create a buyer’s market, which is supported by the next data point.
Finally, the “Investment Sales Volume” data on the table above shows $145.2M in total apartment sales for Q2 2024, compared to a mere $26.6M in Q2 2023. The dramatic increase in multifamily unit sales in the light of high interest rates suggests that buying conditions might be favorable in Ventura.
Overall, Ventura multifamily units show minimal decline in occupancy, and boast an uptick in unit deliveries as well as apartment sales. With that in mind, investors can benefit from looking into multifamily deals in the Ventura market.
A year over year analysis of the multifamily asset class in the Ventura market shows insufficient information on the performance of the market, as looking at just Q2 2023 and Q2 2024 show minimal discrepancy in numbers despite Q1 2024 shedding light on how the market is truly doing. Apartments in the area show a little decline in occupancy (20 basis points over the last quarter), but Ventura seems to be preparing for a buyer’s market as more units are coming online and sales are toppling the numbers from just a year ago.
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