Throughout 2014, real estate markets across the country began waking up and stabilizing — and it’s about time, since the industry has been notoriously shaky ever since the 2008 recession. Commercial real estate investing is, by nature, a risky business. But according to economic analysts, the success that investment groups found in commercial real estate values during 2014 is likely to continue throughout 2015, and it’s even expected that the market will grow substantially over the next year.
According to a report recently published by Urban Land Magazine, there are a handful of trends already predicted to dominate commercial real estate markets throughout 2015. Here are just a few of the more prominent trends that investors across the country are likely to encounter:
- More investment capital and competition. As many investors already know, the U.S. commercial real estate market was largely dominated by foreign investors after the 2008 economic collapse; it’s clear now that foreign investors are still present and still driving up commercial real estate values. For domestic investing firms and individuals, this could become a bigger concern throughout the year; at the very least, it’s important to keep this trend in mind when looking at your own investments.
- Greater willingness to take risks. Although bigger risks generally lead to bigger rewards, the Urban Land report aptly notes that investors have only recently begun feeling comfortable and confident enough to take big risks. It’s predicted that this confidence will continue to grow during 2015, and the market will likely be strong enough to support and reward these risks. So if you’ve got a gut feeling that you should take a big risk with your investments this year, it’s likely because you’ve seen others make big risks recently that have paid off.
- Investors following jobs and people. It’s clear that the job market is driving the real estate market at this point, for better or worse, by determining where consumers want to live and can afford to live. Certain cities — most notably San Francisco, Austin, and Seattle — have experienced huge booms in population and job growth, thus creating a larger demand for commercial properties.
So now you’ve got the experts’ opinions on 2015 trends, but the conversation is turning over to you — do you agree with these trends? Do you think any other trends are going to be more important throughout the year? Be sure to share any comments, questions, and concerns with us (and your fellow readers) in the comments section! Check out this website for more.