Your August Newsletter from CALCAP!

CALCAP CONNECTIONS

August 2021

PRINCIPAL'S CORNER

Supreme Court Invalidates Eviction Moratorium

On August 26, 2021, the U.S. Supreme Court took action to stop the CDC’s current eviction moratorium. The Court decreed (in a 6-3 decision) the acts of the administration to have been unlawful and in excess of the authority given to them under the Constitution and by Congress.

Here are some excerpts from the U.S. Supreme Court's ruling, which explain the Court's logic:

The moratorium has put the applicants, along with millions of landlords across the country, at risk of irreparable harm by depriving them of rent payments with no guarantee of eventual recovery.

Despite the CDC’s determination that landlords should bear a significant financial cost of the pandemic, many landlords have modest means. And preventing them from evicting tenants who breach their leases intrudes on one of the most fundamental elements of property ownership—the right to exclude.

It is indisputable that the public has a strong interest in combating the spread of the COVID–19 Delta variant. But our system does not permit agencies to act unlawfully even in pursuit of desirable ends.

The order is effective immediately and, as of August 27, 2021, tenants will no longer be able to avoid eviction by executing a CDC Declaration or otherwise contesting the eviction due to financial difficulties. On Thursday, the White House issued a statement regarding the Supreme Court's decision in which the President urged cities, states, "local courts, landlords, and Cabinet Agencies - to urgently act to prevent evictions."

Despite this ruling there is still a 30-day notice to vacate requirement for properties that were covered under the CARES Act. This mandate has been in effect for any properties with federally backed or insured mortgages (Fannie, Freddie, HUD) or that received federally related housing assistance like Section 8.

Landlords are still being encouraged to work with residents as much as possible and continue with any payment plans already in place. Evictions are always the last resort. While it is unlikely that the federal legislature with pass another national eviction moratorium, the debate seems far from over. We will be watching closely.

Edward M. Aloe

Founder and CEO

626-229-9057

Latest Headlines...

Where are Boomers Moving to Retire?

They’re not looking just at Arizona and Florida. They’re looking for fun and family, too.

To be sure, members of the baby boom generation are retiring just about everywhere. Still, some areas are more popular than others, particularly for retirees who have the net worth that gives them the freedom to choose.

Not surprisingly, warm weather states like Florida and Arizona continue to experience huge boomer in-migrations. But certain not-so-warm regions also are also booming.

What these locations have in common is that they allow them to maintain an active social life. And there’s another consideration: proximity to adult children—and the next generation of babies.

View Article Here

Multifamily Rents Spike 8.3% YOY in July, Yardi Matrix Reports

Rents have risen 8% since the start of the year, and the average rent rose by $26 in July to $1,510.

Out of the top 30 markets, 13 experienced double-digit asking rent growth YOY. Phoenix led the way at 18.9%, followed by Tampa, Florida, at 16.4% and Las Vegas at 16.1%. Only three markets experienced negative growth YOY—San Francisco at -0.5%, San Jose, California, at -0.7%, and New York at -0.8%. However, with these markets on their way to recovery, Yardi anticipates positive rent growth as soon as next month.

Rents rose by 1.8% on a month-to-month basis from June to July, and 26 out of the top 30 metros experienced rent growth of 1% or higher month to month. San Jose led the list at 3.6%—the strongest month for the city since the start of the COVID-19 pandemic—followed by Raleigh, North Carolina, at 3.5% and Boston at 3.2%.

View Article Here

Large Cities See a Surge in Rental Applications in 2021

Generation Z leads the charge, with a 39% increase in applications for apartments across the country.

Based on an analysis of rental applications by age groups nationwide, the main proponents of rising rental activity are members of Generation Z—the generation born between 1997 and 2012—whose rental applications are up 39% from the previous year. Applications from other age groups rose by 10% or less. The youngest generation makes up 27% of the nation’s apartment hunters and is the only section that is growing. Millennials make up the largest share of active renters at 45%, down 8% since last year.

Considering renters by income, renters earning more than $100,000 were the most active this year, up 34% from the first half of 2020, followed by renters earning between $75,000 and $100,000, up 33% from the same period. A need for larger living spaces to accommodate working from home as the primary reason for moving, while the highly competitive real estate market may have encouraged some high-income renters to continue to rent.

View Article Here

On the lighter side....

About CALCAP Advisors

About CALCAP

California Capital Real Estate Advisors, Inc., and its affiliate entities (CALCAP Asset Management, CALCAP Properties, CALCAP Lending, CALCAP Senior Healthcare and CALCAP Strategic Opportunities, collectively known as “CALCAP”), is a California based investment company founded and 2008 and headquartered in Pasadena, California. The Company sponsors alternative real estate investment opportunities focused on demographically driven housing. CALCAP has been able to consistently provide both individual and institutional investors with outstanding returns over the last 12 years. The Company uses a highly selective and disciplined investment approach, focused on delivering superior risk-adjusted returns. CALCAP currently has over $400mm in Assets Under Management. To learn more visit www.calcapadvisors.com.

Social Mission

CALCAP CARES is a 501(c)(3) private foundation organized to encourage employees to find a way to give back to the neighborhoods where we invest. CALCAP has created "GiveTime4Autism" as its initial program which will allow employees the ability to donate unused vacation and sick days for a very worthy cause.