The State of US Real Estate
As the United States continues to recover from the recession, the retail property market is slowly starting to stabilize, with the office sector also in the midst of a major reset. This article looks at the state of the US real estate market and explores what these changes mean for buyers and sellers.
Location affects value
The location is often a key component in any real estate purchase, including for rental properties. This is true for both the suburban and urban varieties. In addition to where you live, you also need to consider the community facilities and amenities that are available in the area. For example, if you’re planning on building a new family home, you should think about where you’ll be spending your spare time.
In the realm of real estate, a well positioned house will pay you back handsomely. You can choose from a wide array of housing types, from suburban to rural to urban. One of the more enticing choices may be an apartment. If you aren’t up on the latest trends in your particular locale, you may have a difficult time finding a suitable place to call home.
Price increases over the last 10 years
The United States is experiencing some of the most rapid price increases in over three decades. Even Google has real estate investments. Prices are climbing rapidly in a number of metropolitan areas, with the San Francisco metro area leading the way.
These price increases can have a negative impact on housing inequality. In particular, the rate of homeownership is declining, which will further exacerbate the gap.
The first half of the 2000s saw an upswing in prices, as many Americans took advantage of cheap credit to purchase homes. This was followed by a decline in home values in the second half of the decade.
Prices were especially high in neighborhoods that were highly desirable. However, there were also some areas that experienced significant price declines.
While there are numerous factors contributing to these changes, the most obvious is a rising demand for real estate. Many new and young professionals are choosing to live in more expansive and spacious homes.
Rate lock-in is a real phenomenon
Rate lock-in is a real phenomenon in US real estate, and has been for a while. In a nutshell, it’s an agreement between a lender and a borrower to keep an interest rate at a certain level for a predetermined period of time.
The best part about rate lock-in is that it can be a boon to homebuyers. It can protect them from having to pay a higher rate as their mortgage rates inevitably increase. However, it can also make them miss out on a better deal.
It’s no secret that high rates discourage current homeowners from selling their homes. And it’s no secret that demand drives up prices. With more people trying to buy and less houses for sale, the market is a crowded place.
Retail property sector is recovering from the pandemic
The retail property sector is in a state of recovery. Although the market was hit hard during the pandemic, the bottom has been reached and the industry is back to normal. However, it will take many years for the values of retail real estate to recover.
One of the main factors affecting the sector is the impact of the COVID-19 pandemic. It caused a significant increase in online sales, which triggered changes in store layouts and appearance. As a result, there are now a greater number of people trying on products in a physical store.
During the pandemic, retail property capital values declined by 8.4%. Rental growth in standard shops was negative by -15.1%, and in retail warehouses, rental growth was negative by -6.4%. Retail vacancy rates have also increased.
Office sector is in midst of a major reset
The office sector in the US is in the midst of a major reset. Its heyday is over, and a new wave of edgy firms are looking to take advantage of a lukewarm housing market and a weak economy. Fortunately for investors, these developments should see an uptick in the office sector in the coming years. While not as buoyant as the late 90s, the industry is not doomed to an early grave, at least for the next few decades. Here’s what you need to know.
There are many companies vying for your attention, and a few have figured out how to balance the trades while providing their employees with the perks they deserve. Some examples include Starbucks, GE and Verizon, all of which have been able to leverage their hefty swagbags to improve efficiencies.