NAR Research Group analyzed how vacant office buildings are being converted into housing, examining conversions in 27 markets with the largest decline in occupancy since the pandemic and looking at market conditions and factors that led to the success of eight office-to-housing conversions in Maryland, Washington DC, New York, California, and Illinois.
Since 2019, home prices rose nearly 30%. As a result, a typical home is about $80,000 more expensive than pre-pandemic. Meanwhile, inventory of homes for sale dropped significantly in the last couple of years, reaching record lows in 2021.
The recovery in the commercial real estate market that started in the second half of 2021 is continuing into the first month of 2022.
Despite the office sector continuing to shed office space in the face of strong job recovery, 2021 can still be considered a year of growth and potential thanks to demand for multifamily rentals, industrial space, off-premise sites for brick-and-mortars, and investment acquisitions.
Nationally, November 2021 U.S. home showings were down 12% year-over-year with 686,019 showings.
The National Association of REALTORS® identified top 10 markets with prices that were still undervalued relative to their underlying market fundamentals in 2021. These "hidden gem" markets are expected to experience stronger price appreciation relative to other markets in 2022.
The commercial real estate market has continued to recover on all fronts on the back of the sustained recovery in the job market, increased consumer spending, and workers trickling back to the office.
Showings declined in every region: Northeast region (-23%), Midwest (-17%), West (-17%) and South (-12%).
Amid an improving economy, the commercial real estate market continues to recover, marked by rising occupancy across all commercial property markets.
There is strong recovery in the multifamily, industrial, and retail property markets, while the recovery has not been as robust in the office and hotel property markets.