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Saguaro Series 1 and 2 - April 2015 Update

Saguaro Capital Fund Series 1 and 2 remain in a holding, getting paid to wait, pattern as we take advantage of the extremely strong rental market and carefully gauge the resale market which is showing signs of optimism.

Rental Market: For the last few years we have been speaking about the strength of the Phoenix real estate market. We came across a great article that supports our message from the March 17th Daily Observations published by the Greater Phoenix area real estate market expert, The Cromford Report.

March 17 – Daily Observations from The Cromford Report We remember the middle of 2013 when several real estate pundits were lamenting the acquisition of single family homes by investors and confidently predicting they would not find enough tenants and have to dump the homes back onto the market in large numbers.

As often is the case, the pundits were completely wrong. Single family rentals are now is such high demand from prospective tenants that it is becoming extremely hard to find one to rent. Very few investors have sold their investments and the supply on ARMLS has hit an all-time low.

We now have just 493 single family active rental listings on ARMLS priced under $1,200 a month. Two years ago we had 2,326. This is a drop of 79%.

Since we saw 1,053 leases signed in the last month in this price range, this is just 13 days of supply.

We have never seen such a shortage of affordable single family rental homes in the Greater Phoenix area.

Between $1,200 and $2,000 per month we have 25 days of supply and over $2,000 we have a relatively generous 85 days of supply.

Resale Market: As of April 1st, the Greater Phoenix area real estate market seen monthly sales increase 23.2% year over year and 38.8% over last month. Although these numbers give reason for optimism, the monthly average sales price per square foot was down 0.3% over last year, with a slight increase of 0.6% over last month.

Please note:

  • We will continue to email quarterly updates and post news and market updates on the Capstone Real Estate website and Facebook page.

  • The next semi-annual interest distribution will be paid in late July 2015.

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