The city of Santa Ana is Orange County, CA‘s county seat. It is also the second most populous city in the county. According to the 2010 U.S. Census, it had a population of 329,427 at that time, which means it is the 57th most populous city in the country. Located in the south of the state, next to the Santa Ana River and just 10 miles from the coast, the city, which was founded in 1869, is part of the Greater Los Angeles Area. With 18 million residents, this is the second largest metro area in the country. Additionally, Santa Ana has been ranked 4th safest city with more than a quarter of a million residents in this country.
Santa Ana Multifamily Property for Sale & Lease – Should You Buy or Lease?
If you are interested in multifamily space, be that as an investment or to run a business out of, you have two major choices available to you: buying or leasing. There are pros and cons to both of these options.
Looking first at buying multifamily space, the pros include:
- That your costs are fixed, which means you have clarity on your business expenses.
- That you can really make use of some good tax deductions, including property taxes and mortgage interest.
- That you can rent some of your space out so that you can earn some extra income.
- That you can accumulate some savings, as the property is likely to appreciate over time.
However, the cons are substantial as well and include:
- Not having much flexibility, which means that if your business either contracts or grows, you may have to sell the property sooner than you expected.
- Having high expenses upfront, primarily because of the down payment, which is usually at least 30 percent of the selling price. You will also have maintenance, appraisal, and other property costs to pay.
Your other option is to lease your multifamily space, which also has clear benefits, including:
- You have a chance to get a prime property, which is important if your public image matters.
- You can free up some working capital because you don’t have to provide a down payment.
- You can focus on actually running your business, rather than worry about property management.
However, there are some downsides as well, including:
- Your costs will be variable as a result of rent increases.
- You do not build up any equity in the property, since you don’t own it.
To help choose between the two alternatives, being aware of the trends and statistics in terms of prices, supply, and demand, can be very beneficial.
Santa Ana Multifamily Property for Sale – Trends and Statistics
- The asking price for multifamily properties in Santa Ana $314,841.90, which is a 0.7% increase over the past three months, and a 10.5% increase year on year. This is higher than the state ($206,014) and the metro ($254,071.41) area.
- The index of total available multifamily properties for sale in Los Angeles-Long Beach-Santa Ana is 29, which represents a 13.4% increase over the past three months but a 2.5% decrease year on year.
- The index of total number of listings of multifamily properties available in Los Angeles-Long Beach-Santa Ana is 24, which is a 8.9% increase over the past three months, but a 1.3% decrease year on year.
- The profile view index multifamily property for sale in the Los Angeles-Long Beach-Santa Ana metro area is 97, which is a 24.9% increase over the past three months, and a 22.5% increase year on year.
- The index of total number of units of multifamily property for sale in the Los Angeles-Long Beach-Santa Ana area is 21, which is a 12.2% increase over the past three months, but an 11% decrease year on year.
Santa Ana Multifamily Property for Lease – Trends and Statistics
Multifamily property lease statistics have been made available for the Santa Ana, Anaheim, and Irvine market area, also known as the Santa Ana HMA. The conditions in this market are currently very tight, with a vacancy rate of 4.8%. Since 2010, growth in the number of renter households has outpaced not just the construction of new multifamily properties, but also the conversion of existing single family homes into rental units. There is currently a demand for 11,225 new rental units, but only 2,900 will be constructed.
At present, multifamily property monthly lease prices vary depending on the number of bedrooms. The starting prices are:
- $1,700 for one bedroom units
- $2,100 for two bedroom units
- $2,600 for three bedroom units
These prices are reflective of the affluence of the HMA. However, the fact that demand for rental is now so high also shows that some people continue to struggle economically and are unable to find a mortgage.