The stock market tumbled with the Dow giving up 512 points today or 4.31% of its value (Nasdaq 5.08%), the worst since December of 2008. The upside to this, interest rates also came down. Now is probably a good time to refinance your house especially if your loan amount is below $729,750. I got a quotation today of 4.00% fixed for 30 years with ARMs as low as 2.5%.
With news like today, we may have a movement of cash out of equities into more tangible assets like real estate. Some areas have been wrecked by this recession while others have held their values at nearly 2007/2008 pricing and fetching very low yields. Recent sales that support this include, a Trader Joe’s in Manhattan Beach at 1821 Manhattan Beach Blvd. which recently sold at a 5% cap rate, a New Balance store at 26th and Wilshire in Santa Monica had multiple offers and sold around a 4% cap rate in May and a long term leased El Pollo Loco on Vernon and Crenshaw in Los Angeles that sold at a 5.49% cap rate in February of 2011.
