Houston property number one to watchApril 3, 2018
Property prices in Houston continue to strengthenApril 3, 2018
A report released last week showed US commercial property prices had now recovered to their pre-global financial crisis levels.
The recovery had been led largely by an increase in the value of apartment buildings and office space in central business districts.
The Moodys/RCA Commercial Property Price index released last week showed the national all-property composite index rose in September and was now 0.2 per cent higher than at its last peak in November 2007.
The index had recovered a loss of more than 40 per cent since its lowest point in January 2010, Moodys said.
Apartment prices were particularly buoyant, having passed their pre-global financial crisis peak and are now 18 per cent higher than in 2007.
This was due, in part Moodys said, to low borrowing costs from mortgage lenders such as Fannie Mae and Freddie Mac.
“Multifamily sprang back quicker, since it only had a few quarters where there was a contraction in debt available,” Tad Philipp, director of commercial real estate research at Moody’s, said.
Other property types “took longer to come back because the liquidity took longer to come back.”
In the past year, the best-performing core commercial property type has been office, with prices increasing almost 18 per cent.
Retail prices have had smaller gains, with a 5.3 per cent increase in the past 12 months.