Over the past few years, the real estate market has been tough on property managers. Economic recovery has been slow, putting downward pressure on prices and leaving apartment and office space unoccupied. Looking forward to 2013, however, experts are optimistic that the market will gradually improve.
The Impact of Job Creation
Recent job creation will bring down vacancy rates in the office, retail, and commercial real estate sectors. Although this may or may not affect you directly, the increased occupancy levels of office and retail space will allow property managers to charge higher rents. Additionally, job creation should bring an influx of renters, as new hires and candidates for those jobs will likely be looking for housing near work.
Strategies for 2013
2013 is looking like an ideal time to get into the single- or multi-family housing market. Various studies show large capital investments within the next year in these sectors. In addition, according to Bev Thorne, CMO at Century 21 Real Estate, we should expect to see demand in the residential real estate sector finally increase in a sustainable manner in 2013. With the market potentially on the verge of an upswing, investing while prices are still relatively low now could be an effective strategy. The benefits of holding on to your properties, in anticipation of property value increases in the future, is also something to consider.
The overall trends in real estate appear to be the most promising in the commercial sectors rather than residential, especially in the high-tech and green industries. If you’ve been thinking about expanding into the commercial sector, this may be the time to do it. Studies suggest that major urban centers have the greatest potential for growth and point to these 5 cities as having the strongest markets: San Francisco, New York City, San Jose, Austin, and Houston. Following close behind were Boston, Seattle, and Washington D.C.. This growth in commercial real estate could indirectly impact the residential sector. As new office space is occupied, built, or repurposed from abandoned buildings, new residential markets emerge in their proximity. Keep an eye out in these cities for new opportunities for investment.