Pensacola Multi-Family Sales Market Update

Small Multi-family apartments have been a favorite for investors looking to buy real estate, especially for investors in the Pensacola market. However, the latest trends have made finding reasonable rates of returns harder to achieve as interest rates and sales prices have increased rapidly. As you can see from the chart below, Pensacola multi-family sales prices have increased drastically in recent years. In the Pensacola area, the average sales price of a duplex increased nearly 67% and a quadplex increased nearly 40% 2020 to 2022. As promising as this is, prices may be nearing a peak. Previously, multi-family sales prices in the Pensacola area peaked in 2009 and remained drastically low through 2015. They began to gradually increase until 2021 when real estate sales prices exploded.

In 2023, commercial property sales across the US are seeing declining trends throughout the country with a 57% drop in volume across the board for the first quarter of 2023. The Pensacola area commercial market has only seen a small decrease in average sales prices thankfully, but that could be changing. Rents are starting to show indications of a slowdown too. While rental prices have increased during 2022 compared to the same period of 2023, the days on market for rentals have started to creep up. The 2022 rental market saw an average days on the market of just 16 days over this time, while 2023 has seen that number jump to 34. April had an average rental rate of $1,800 and May has only seen that price go down to $1,680. This could be the first sign of rental rates hitting a peak for what the market of renters can afford. If investors cannot find a good return with commercial or smaller multi-family properties at the current prices and rents, then they will likely look towards other investments. We have also seen a drastic increase in interest rates making it even harder for new investor to cash flow at these prices. As rates increase and rental profits decrease, it is only logical that investors are going to start to shy away from purchasing commercial multi-family properties. Multi-family properties are only considered commercial once they are over 4 units. However, that declining trend may soon start to spill over into residential multi-family properties like duplexes, triplexes, and quadplexes.

Selling your Pensacola Multi-Family Property

If you are looking to maximize the investment return on your multifamily property, it is key to anticipate these trends and sell while the supply and competition is still low. Luckily smaller multifamily homes are still seeing a strong sales market in 2023. The average sales price has dropped slightly compared to last year, but the average time on the market for a multifamily property has only been 21 days compared to the 31 days we were seeing in 2022. At this time, owners can expect to get a quick sale while still near peak prices. Due to all these factors, owners with significant equity in their rentals should consider capitalizing on their equity in 2023. At Realty Masters, we have multiple experienced sales agents that work with a network of investors who can help you get your Pensacola duplex, triplex, or quadplex sold for top dollar. If you would like a free market analysis on your on your multi-family property, complete the form here for a free CMA or reach out to us today at 850-473-3983 or email at info@pensacolarealtymasters.com.

Buying a Pensacola Multi-Family Property

If you’ve got cash and you’re looking for a long-term income source, a duplex, triplex, quadplex, or small apartment is always a great investment if your goal is long-term buy and hold for retirement income or to pass down to your children. Our agents specialize in buying and selling multi-family properties. As Pensacola’s largest property management company, a bulk of our long-term clients are investors who own these types of properties. Search Pensacola area multifamily properties below and reach out to our team today.

Search recent multi-family homes for sale or recent sales on our Pensacola Multi-Family Homes for Sale here.

Homes for Sale

Managing your Pensacola Multi-Family Property

We understand that not all owners are interested in selling in any environment, as many multi-family properties are income sources for retirement or inheritance. If you’re self-managing your property, why? It is now becoming even more important for landlords to use a good management company to alleviate these longer times on the market and counter act slowing rents. Our agents leased homes with an average of 14 days on the market in 2022 and the first half of 2023. We manage everything from single family homes to small apartment complexes, and every type of residential and commercial multi-family property in between. We also offer investor and active-duty military discounts for homeowners to lower their rising expenses. If you are becoming frustrated with finding quality tenants and handling the day-to-day management of your property, take the tax deduction and hire a professional property manager. If you are interested in talking to one of our Realtors about Pensacola property management, complete the form here or email us at info@pensacolarealtymasters.com.

Here are a few relevant articles on buying and selling multi-family properties!