Experts indicated the commercial real estate sector's outlook is fairly positive during a forum at the Realtor Midyear Legislative Meetings & Trade Expo.
Expert Jeffrey DeBoer stated that a lack of credit may be the market's main short-term challenge, Multifamily Biz reports. This should be addressed immediately to strengthen the market. Other issues he noted include equity and the pace of job creation. In the long-term, tax reform and policy will also be substantial issues.
Lawrence Yun, chief economist for the National Association of Realtors, said that recent strides in job growth and consumer spending are positive indicators for the commercial real estate industry. Improvements in personal incomes and the stock market are also promising signs, although the process of recovery remains a slow one for the most part.
He agreed with DeBoer that limited credit availability is slowing commercial real estate market activity. He did note that the apartment sector is still leading the industry, with low vacancies and rent increases. He estimates that rents will grow 4 percent next year as low construction continues to lag behind the current level of demand for multifamily units, suggesting rental property management firms have a strong outlook for now.