It’s common knowledge that the commercial real estate market is largely at the mercy of the residential housing market. Consumers tend to lose confidence when the homes they spent $400,000 to buy are now worth $200,000. And when consumers aren’t confident, they don’t spend. That, of course, equals tough time for the country’s economy and its commercial real estate market.
That’s why HomeGain’s 1st Quarter National Home Values Survey is such an important piece of research for commercial real estate professionals. And the news from this survey? Well, it’s not exactly great for anyone hoping for a stronger national economy.
According to the survey, 37 percent of real estate agents across the country expect home values to increase in the next six months. You can figure out that this means a lot of agents expect home values to either fall or remain stagnant.
In fact, according to the survey, 22 percent of real estate agents expect home values to fall in the next six months while 41 percent believe they will remain the same.
These numbers are actually improvements over HomeGain’s fourth quarter, 2011, survey. But let’s be honest: Few real estate agents expect to see housing prices soar in the next six months.
For commercial real estate professionals this means one thing: Yes, the country is in recovery mode. But no, the speed of this recovery isn’t about to pick up any time soon.