Focus is on the Federal Reserve
Question: Considering the size and magnitude of the US stocks and bond markets, strength of the US dollar, major happenings in China, oil supplies, or Europe, a Question: Do we really believe one small change in short-term rates would alter US markets or falling commodity prices? Neither a small change or no change in rates can stop a big ship in motion or start one already stopped. Let’s not panic. Without real inflation, or threat of war, or bank failures, lending rates will continue to favor commercial real estate.
Instead let’s focus on what moves our real estate market.
Big money is slowly beginning to move from stocks and bonds, into prime properties. This includes China. This new demand is raising prices and improving values for all commercial properties. The tide is rising for all.
Why so? Because with rising rents, risk of failure decreases. Add to this very attractive lending rates and you have improving cap rates. It is the natural flow of markets seeking lasting value with limited downside risk. Bottom line: Real estate yields are improving and appreciation is real.
The Good News: We have lenders who love our markets.
This past month our success continues with construction-completion loans. Two clients came to us, after their big-bank lender left them at the last minute. Permits were ready, but they changed their mind. Who needs this? We met, worked out the kinks, and received the go-ahead. Again on the approval track, our client are smiling, having lenders they can trust.
Thank you for your referrals, as we work on a Gas Station purchase, a hotel rehab, and a lender-reset for an updated apartment complex.
Give a call. Let’s meet your challenge and find solutions.
Keeping you informed and hoping you have a fabulous month.