A lot of economic analysts believe that the employment condition in the U.S. this year will stay the same, noting the five percent decline, which means an additional demand for housing, and either for the retail sector or for office space. Here are some of the trends that are believed to play an important part in the commercial real estate this year.
Interest rates are most likely to increase.
The Federal Funds Rate will increase to at least 1.0 or above this year, with the ten-year Treasuries working fractionally greater toward its three percent mark. There are some factors that are known to keep the rates going lower, such as the limited inflation because of the import prices and soft energy, as well as the strong dollar.
Global capital that comes in the real estate assets of the U.S. will remain and increase.
According to NREI Online, the international political and economic uncertainty will remain as the driving force of the capital towards the U.S. since the country's property market is regarded as the most transparent and stable, which makes it a perfect target for investment.
Continuing retail movements and stress.
With the growing interest rates, the consumers are expected to pay more to rely on their credit cards, which will lead to more analysis in their manner of spending. Analysts are assuming that those successful retailers are the ones who can enhance both the physical and virtual shopping experience.
The previous year witnessed a notable price drop in oil.
Increased rate of production and lowered demand because of the slow growth in the emerging market have resulted to a price drop in oil from $110 for every barrel to below $50. The effects, however, will differ according to sector and region. Lower energy and oil prices will also lessen the costs of manufacturing, construction and logistics. This will help the business with its expansion and investment, thus, increasing the need for manufacturing and industrial space, Urbanland shared.
