Tag archive for "Commercial Real Estate Trends"

Rent Control and Other Real Estate Trends To Watch Out For

Staying on top of current trends is an important part of successful real estate selling. What will buyers, sellers, investors and construction firms be doing in the new year? Experts offer these predictions on real estate trends to keep an eye on in 2020.

1. Mortgage rates continue to drop.

At the close of 2019, the interest rate for a 30-year fixed-rate mortgage was at an average of 3.99%, making it a good year for first-time buyers and refinancers. With trade wars going strong and global economic growth stagnating, there’s a good chance the Fed will cut interest rates at least twice. As of mid-January, average rates were already at 3.79%.

2. Rent control spreads to more areas.

As many people struggle to find affordable housing, several states are turning to rent control. Oregon, California and New York all passed rent control bills in 2019. Other high-cost housing states such as Illinois and Washington are on a “watch list,” while rent control has become a talking point for a number of Democratic presidential candidates.

Rent control has already caused multifamily housing investors in affected markets to rethink and even reduce their investments, an issue that’s likely to occur in other states as they enact legislation.

3. Builders remain focused on starter homes.

Post-recession, builders turned their efforts to the more profitable segment of custom homes for well-to-do buyers. As a result, demand by first-time home buyers has remained strong, but the inventory of starter homes has dried up.

Builders specializing in entry-level properties saw double-digit percentage increase in sales last year, a trend likely to continue as supply tries to catch up with demand.

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Trying to Break into the Luxury Home Real Estate Business?

It’s Been Confirmed, It’s a Seller’s Market

Fistfights breaking out at your brokerage over the possibility of gaining a listing? Just in case the dog-eat-dog listing races and woeful number of affordable homes on the market for buyers weren’t enough of a confirmation of real estate trends, Trulia and Realtor.com statistics have finally confirmed: It’s a seller’s market.

Strongest Seller’s Market Ever
Brand-new spring housing market numbers have confirmed the trend, looking to statistics from the country’s 100 largest metro cities. Boiling the trends down by zip code, it uncovered a shortage of homes nationwide – a deficiency that hasn’t been this bad in 20 years.

Inventory for March is down 6.6% from a year ago, and unsold inventory a 3.8 month supply. (A balanced market is a 5-6 month supply.) This has led to monthly rises in home prices, up nationally 5.7% for February, year-over-year.

Slim Pickins
As buyers frantically search for affordable homes, the market is getting increasingly competitive, with first time buyers experiencing the greatest hardship. Even as more homes enter the market for the popular summer sales season, they’re flying off neighborhood shelves fast. And at entry-level, where demand is greatest, sellers remain firmly in the driver’s seat.

Heavy Competition
There’s no shortage of people on the lookout for a new home. And though people prefer a home that’s move-in ready over one they have to upgrade, its concession-time in a market where bidding wars are par for the course. Sellers are optimistically pricing their homes – and most are selling anyway.

To compete, buyers are dropping contingencies and coming in with cash. Multiple offers are the new norm. Worse, real estate trends of home appraisals regularly coming in well below sales price are dropping a wrench in the works for would-be first-time, mortgage-dependent buyers.

What are you doing to rise above the competition in today’s seller-centric market? Stand out with the tools and technology of Properties Online today.

Video Usage in Real Estate, the Stats Are In

Commercial Real Estate Delinquency Rates Climb – Watch Out In 2017

Commercial real estate trends point to prices falling by as much as 5% in the next 12 months.

What gives?

A storm is brewing, creating a tsunami of issues for the commercial sector. The global surge in U.S. property investments that drove record values in years passed is expected to wane alongside lower oil prices and disjointed debt markets. Property sales by publicly traded landlords, debt maturities, and tightened regulations are furthering the trend. The instability is creating a volatile commercial real estate selling atmosphere, with uncertainty about U.S. policies following the presidential election worsening matters.

Let it rain

Commercial mortgage-backed securities (CMBS) float amidst a tumultuous market in which borrowing costs for landlords are higher, inhibiting future price growth. Properties in small cities, dependent on Wall Street banks for funding, have been hit especially hard – a global market rout in February sent prices plummeting after Wall Street dealers were unable to provide liquidity when hedge funds were forced to sell CMBS holdings. Regulations such as Dodd-Frank are also not helping the situation, making it increasingly expensive for banks to hold securities.

Cold front

The market has shown signs of cooling since the start of the year, with commercial property values in big cities declining 3% in just the past 3 months. New York, the biggest market, is forecasted to decline as much as 30% over the year. Even REITs (real estate investment trusts) are being affected, with shares trading at prices that undervalue holdings (shopping malls, office buildings, hotels, etc.), leading them to become net sellers.

Bailing out

Despite the expected downturn in commercial real estate trends, the sun could break through the clouds, presenting new opportunities in the form of bargain prices for investors, and opening opportunities for investors to bail out borrowers who’ve come up short.
Are you prepared to weather upcoming commercial real estate trends? Properties Online is here to help. Contact us today.

2016 Real Estate Trends: The Move Towards Online Real Estate

Has 2016 Delivered on the Projected Commercial Real Estate Trends?

Trends are emerging that will disrupt “business as usual” in the commercial real estate market. Dropped your crystal ball? No worries – we’ll fill you in…

Time’s they are a changin’ – redefining this market segment and plotting a new course:

• More general development
In this sixth year of recovery, office, industrial, hotel and residential development are expected to grow as the economy shapes-up, interest rates increase, and access to financing widens.

• Retail stalls, warehouses boom
As e-commerce continues to change the landscape with faster delivery options and the rise of online shopping/in-store pickups.

• Autonomous vehicles and car sharing
Could transform real estate markets – and parking situations. This includes drones and driverless vehicle technology.

• Flexibility is key
The process of identifying space to meet consumer needs (variable schedules, shifting calendars, shared space) will be accelerated due to high demand. Real estate owners should be looking to form partnerships with these shared providers.

• Multi-tasking environments will be in huge demand
Places where people can work/live/play 24/7 – on-site and without the 30+ minute commute. And this re-urbanization is underway globally.

• Rising capital investments
As institutional investors strive to take advantage of these changes and boost portfolios. Mergers/acquisitions will rise, and REITs could go private through buyouts.

• Customer migration to online real estate shopping, sales, and more
Tenants/customers looking for better, faster service will rely on the Internet for more data access (i.e.: who has the space they’re looking for at the best price), as well as the streamlining of property operations (hint: controlling heating and air conditioning systems/costs are only the beginning). Real estate owners must start investigating ways these evolving technologies can improve interactions with tenants and customers now if they want to ensure future success.

Don’t get stuck in the past, look into the future of commercial real estate. Take advantage of the next generation of real estate sales technology. Grow with the changing world with Properties Online today.

Commercial Real Estate Industry Lags in Embracing New Technology

A report compiled by Altus Group, a Canadian information technology (IT) firm, recently found the trillions of dollars invested in the global commercial real estate market are being processed with grossly outdated technology at risk for human error and inaccuracy. Though real estate trends have shown an increase in new commercial real estate capital, it has apparently NOT been funneled into upgrades.

Error 404 Commercial IT Doesn’t Exist
Dollars have been invested instead in other tech, such as smart building technology, automation systems, and improved energy efficiency. All the while the roughly $11 trillion in commercial real estate investments worldwide are handled manually via spreadsheets.

Warning: Parental Controls Have Blocked this Site
This inherently manual system introduces not only the element of human error, but lack of visibility through data silos – stifled, lost, or overlooked information resulting from a poor data management system that makes real-time data comparison for professionals nigh impossible.

Improper Bandwidth
Compared to the healthcare and finance industries, commercial real estate investment in IT is falling woefully behind the times. How far? The industry is struggling to efficiently absorb it’s huge interest – upwards of $500 billion this year alone in new capital.

WARNING: Your IT Has Not Been Updated in 3,650 Days
Though the appetite for IT investment exists, committing to it over asset acquisitions and networking will be the challenge. In Canada, home of the study, a push is being made to synchronize data across a single platform countrywide so brokers can share information, thus combatting inefficiencies in the system which are currently preventing access to tangible, essential information central to commercial real estate services. Its completion date, however, is unknown.

Is your real estate business running on MSDOS while the competition is sporting Windows10? Stay up on the latest real estate trends and upgrade your future success with the help of Properties Online today.

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