2023 Market Predictions in Commercial Real Estate

By: Taro Chellaram /Real Estate Articles/Dec 28, 2022

2023 Market Predictions in Commercial Real Estate

The year 2022 is coming to an end. 2023 is just around the corner, and with it comes great news for real estate investors. Post-pandemic, there have been many ups and downs in terms of market stability. Overall, the real estate market proved to be a successful investment option for long term investments. We saw a hike in home prices, followed by a hike in interest rates and then a fall in home prices, continuing with the high levels of interest on loans for real estate. Despite these fluctuations, demand for real estate has not fallen. In terms of commercial real estate, we saw a rise in demand in the retail sector, predicted to continue well into the new year. There have also been several developments in the hospitality sector and office spaces this past year.

Like 2022, the new year will see investors act with caution when it comes to commercial real estate. This, however, is not a bad sign, but the opposite of it. According to the reports, investors, though cautious, are keen to invest in real estate. According to experts, investing in fundamentals would be the best step to take. This includes investing in industrial, multi-family, across the alts - data centers, single family build for rent and student housing. 

2023 is predicted to be the year where normalcy will return to the real estate sector. CBRE forecasts a 15% year-over-year drop in U.S. commercial real estate investment volume in 2023, however, these rates surpass those of the pre-pandemic times during 2019. Despite the slight decline in prices in 2023, there will be a good demand for investment opportunities. This is mainly due to the strong job market that is set to continue in the coming year, keeping demand high. 

Commercial real estate is well-positioned for strong momentum in the second half of the year, with tailwinds predicted to be stronger than headwinds. Go on, start building your wealth by investing in commercial real estate. 

The content of this article is intended to provide a general guide to the subject matter. TC Global Commercial is not a financial advisor and is not responsible for the outcome of decisions taken by the reader. Any investment or financial decision must be taken by the reader at their own discretion or on the advice of a financial advisor. Do not construe this information or other material as legal, tax, investment, financial, or other advice.



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