According to Marcus & Millichap’s Q4 2011 market report, transaction velocity across Riverside and San Bernardino counties increased 3% between late 2010 and late 2011, with closings involving assets above $10 million roughly tripling. The median price of an apartment property sold in that region rose 7% during that time period. Meanwhile, cap rates for best-in-class multifamily assets located along the metro’s western boundary averaged in the high-4% to mid-5% range, and properties farther to the east averaged between the mid-6% to low-8% range.

“The outlook is that few quality REO assets are becoming available and overall apartment operations are improving, so traditional apartment transactions will account for a larger share of closings, the report continues,” says Marcus & Millichap’s report. “As investors capable of qualifying for favorable lending rates move to lock in terms ahead of stronger rent growth, this trend will become particularly evident in densely populated cities closest to the area’s western boundary.”