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Panel Discusses Commercial Health at NAR Conference

Realtors attending the ""National Association of Realtors'"":http://www.realtor.org/ (NAR) ""Midyear Legislative Meetings & Trade Expo"":http://www.realtor.org/midyear.nsf/ expressed renewed confidence in a forum on the commercial real estate (CRE) market.

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NAR chief economist Lawrence Yun joined several Realtor CRE specialists on a panel to discuss the economy and regulatory issues and how they impact the market. In a live audience poll, the majority of attendees said their local economy is either a little better or showing a major improvement from last year.

""Right now we are experiencing a unique recovery phase,"" Yun said. ""Those in the high income brackets are seeing much improvement in the economy, particularly related to stock market wealth. However, those in lower income brackets are not seeing any growth in their income.""

According to Yun, overall transaction volume in the CRE market is slowly improving, and property sales are on the rise. In terms of markets, New York City tops the list in sales volume--however, smaller markets like Seattle and [COLUMN_BREAK]

Austin are also experiencing significant annual improvements, indicating that large investors are more willing to purchase in midsize markets.

In addition, sales of small transactions (of one million or less, those most often handled by NAR commercial members) are starting to improve. While Yun noted prices for those deals have not yet stabilized, the association has seen an upturn in sales volume.

Also discussed at the panel was the topic of credit availability, which is ""still not good, but better than a year ago,"" according to an audience poll.

""There's capital available out there,"" said panelist David Sight, VP and broker for Reece Commercial. ""My feeling is that credit has opened up, but it still helps to have a healthy down payment and good credit history.""

According to NAR's data, commercial members receive their financing from mostly regional and local banks as well as credit unions. Many have reported that finding credit is still difficult because of regulatory conditions and uncertainty stemming from legislation like Dodd-Frank.

Fifty-eight percent of the audience reported they believe CRE will improve in 2014.

""I believe the market will be a little bit better,"" said Realtor Linda St. Peter from Prudential Connecticut Realty. ""I don't think it's ready for a big improvement, but that fear that paralyzed people is starting to fade and confidence is returning.""

Yun echoed that sentiment.

""What is lacking for a stronger economic growth is confidence,"" he said. ""Our Realtor members are feeling a little better and that sentiment will hopefully translate to a better market soon.""

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