According to a recent report by PricewaterhouseCoopers LLP, the United States commercial property sales are expected to increase within the next few years, as more and more property investors gain confidence in the market as a whole.
According to this quarterly survey, job growth, as well as higher business and consumer optimism, are encouraging purchasers to get into the market now with the interest rates where they are. By waiting, interest rates could increase, as well as push prices up in the office, industrial, multifamily, and retail sectors.
Everyone is awaiting recovery of the real estate industry, and as confidence grows among investors, the better will be the results for the industry. The long wait has caused some investors to become more eager to get back in there.
According to an index from the Massachusetts Institute of Technology Center for Real Estate in Massachusetts, commercial real estate prices surges 19 percent in 2010. Estimates from real estate experts believe that commercial property transactions could increase up to 40 percent this year, to $135 billion.
Additonally, the PricewaterhouseCoopers report stated that with low interest rates and stiff competition among buyers, the chances of getting good returns on investments are favorable. In 27 of 31 office markets, capitalization rates decreased.
It is estimated that within the next two years, most industrial markets will improve, with 86.2 percent expected to be in recovery by 2012 as demand surges. With supply and demand becoming more balanced, vacancy rates should decrease and the rental industry should increase.
The multifamily sector has been doing quite well due largely to more challenging lending restrictions and limited home buying opportunities. As a result, demand for apartments have increased and are expected to continue for the next couple of years.
http://www.bloomberg.com/news/2011-03-21/deal-volume-to-drive-u-s-commercial-real-estate-recovery-pwc-survey-says.html
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