Hell of a year, to say the least. In the interest of brevity, let me be short and sweet. Here are my predictions for 2021.

The plague

The very obvious question is whether there will be a negative impact on real estate due to Covid-19 / Coronavirus. Short answer, yes. Long answer, yes again. This is especially true in the commercial space of the mall. Restaurants depend on the residual income of a prosperous society. America is a prosperous society. The per capita of almost all social supplies is off the charts. The overabundance of restaurants, gyms, spas, grocery stores, and even tire repair shops pales in comparison to other societies, and even Western democracies. Ergo, America has suddenly realized that it doesn’t need as many restaurants as it thinks it does, when you consider that eating at home is financially healthier, in a time of uncertainty.

My sources of information, such as the quarterly reports from Deloitte & Touché and CCIM (Certified Commercial Investment Managers), indicate that office space (for very obvious reasons), retail and multi-family housing will find themselves in a slump over the years. next 18 months mid-2022. But for warehouse and industrial space, life is exceptionally long. The need to accumulate resources and provisions for consumers is quite evident.

On a different note, home sales, which are not connected to commercial real estate, but rather residential real estate, are doing exceptionally well. This robust arrangement is the result of many wealthy Americans (and job security), allowing for home purchases and / or an upgraded home. This is also an integral part of the fear of raising interest rates; the need for property, personal space, and solitude; and probably a bunker mentality, in which some existentially fear that hordes of people wander desperately looking for food in a fake realism of Dawn of the Dead (and cable news overload), but superficially there is no threat, but only in one’s own psyche. . It is important to note that despite the chaos, the unemployment rate is still only 6.7% as of November 2020.

Interest rates

As I correctly predicted last year, rates hit a new low, prompting an increase in market activity. Based on the economists’ predictions I have read for 2021, because there is some dissent within their mindsets, interest rates will fluctuate back and forth, but they should be about a fifth of a point below where they were at. late 2020. That calculates about 2.90% for the 30-year fixed rate.

Vendor market

In most localities in the US, it will be a seller’s market, which has an inverse relationship to demand. That is, when you have a higher demand from buyers, there will be an increase in house prices, resulting in a seller’s market.

Runner productivity

This revelation is truly dear and close to my heart, given that I was previously a commercial real estate broker twenty years ago before I started buying houses on my own. The fusion of technology for residential brokerage has been in the works for a long time and will see a more efficient number of brokers, perhaps also competent, as the number of closed transactions is expected to increase in 2021. This is partly as a result of technological advances. On the contrary, in 2019 the average number of homes sold through residential brokerage was 50.7 homes. In 2021, there is expected to be a marked improvement in that number, plus the average broker will take less time to close deals.