Commercial Market on the Rise
Commercial real estate has been a significant factor in America’s economic growth. So, it’s a positive sign that REALTORS® reported commercial sales and prices rose in the last quarter. On a year-over-year basis, sales increased 11 percent and prices rose 4 percent. While several sectors of the commercial market are showing growth, the multifamily market is the strongest. This is attributed to the fact that nearly all of the new household formation in the past 10 years has come from renters and not homeowners.
Despite the positive growth, REALTORS® have identified a few areas of concern for the commercial market. The pricing gap between buyers and sellers and the lack of available inventory are top concerns. While financing continues to be a challenge, it dropped on the list of concerns to third place, perhaps signaling a shift in market conditions.
Gather local data on your area’s commercial market. Find out if the local market mirrors the national outlook, specifically the multifamily sector. Speak with REALTOR® commercial practitioners and ask them what challenges they are facing and how those will affect consumers.