Dear Open Sesemi Sheet reader,

Thank you for your continued support as we strive to bring you the most accurate vacation rental and multi family investment information and prospects in Oregon & California.

To celebrate our first anniversary date with Fathom Realty we wanted to share some highlights from the past twelve months, market insight and a handful of HOT STR prospects as we approach the Spring real estate shopping season.

🌊 The Oregon Coast STR and RE Market Overview

The winter was even slower than usual for most real estate activity, however multi family and high value vacation rental properties still attracted strong levels of activity. We listed a coastal duplex that went pending in days and helped a buyer acquire a duplex in Salem that was competitive.

So far this year on the STR front, the southern OR Coast continues to offer relative value. We helped two investors during Q1 in Brookings and Gold Beach secure Oceanview and walk to beach STR rentals in the $750K range.

The primary investor challenge is inventory and lack of optimal options. At present our STR HOT sheet shows ± 100 properties with vacation rental potential ranging from $300k-$2M+

🏡 Mortgage Rates and Creative Finance Solutions

As we anticipated, inflation remains sticky and the FED will not be reducing interest rates (unforeseen circumstances excluded) as aggressively as the market anticipated. At most 3-4 rate cuts of .25% each before end of the year are now expected. The cost of living (and owning real estate) continues to rise in many areas, and with many home buyers and investors sidelined by the lending environment, any noticeable reduction in rates could raise demand for the little inventory available. For example: on FHA primary home purchases rates are often in the low 6%’s, a combined .75-1% rate reduction would spike demand.

The majority of our clients utilized niche lending programs with our recommended lenders, often with seller concessions towards closing costs or interest rate buy downs and/or programs that utilized lower down payments or limited or no PMI. We had several clients utilize proceeds from 1031X or sales of property reinvest on cash purchases, as well as one seller carry transaction.

For our 20 year anniversary in the mortgage industry, beginning in Q2 2024 we will offer IN HOUSE mortgage and lending options directly to our clients as an additional resource to save time and energy with investment analysis and acquisition. By partnering with one of the premier mortgage platforms in the industry, clients will have instant access to over 100+ residential and commercial lenders.

Our conventional mortgage services will be available in Oregon & Florida and Commercial & Non QM or DSCR loans in most states.

If you have a loan scenario you’d like to price or compare text or email us 24/7/365.

✨ NMLS Settlement + STR Forecast

As you have likely heard by now, there was a major settlement that effectively changed the landscape of how buyers brokers specifically are compensated. Without delving in too deep, the net effect for now will likely be limited. In general I would anticipate somewhat reduced costs of commissions (although likely to still be paid by sellers.) I’ve written about this extensively on Bigger Pockets about the possible rise of flat fee, or per hour RE consultants but in the short term there will likely be MORE need for a buyer representative that can take all transactional factors into consideration.

Additionally STR investors should keep a close eye on the STR Tax standings. This is an excellent article that provides a great summary of some of the benefits and requirements of meeting the threshold.

In general, the forecast for OR STR’s is positive. Bookings and Occupancy are up from last year and due to increasing restrictions, the new inventory of BNB’s coming to market is limited. For example in Lincoln City, the overall CAP will continue to be reduced by over 50% through sales attrition in the coming years. There are exceptions and communities in LC that still permit vacation rental usage outright and will likely see higher production in the coming decade.

Here are SIX STR Picks this week on the OR Coast:

You can also search for yourself at www.sesemisheet.com Text 541-800-0455 for the cheat code.

Thank you for reading this week’s edition of Sesemi STReet your premier information source for Vacation Rental and investment properties throughout Oregon & California.

Anthony AJ Wong

Licensed Real Estate Broker in the States of Oregon & California

Fathom Realty

NMLS ID: 2297941

541-800-0455 / [email protected]