CRE Values Will Hold Steady in 2018
HOUSTON—Commercial real estate values are widely expected to hold the line in 2018, according to valuation experts surveyed by Situs RERC. Meanwhile, most expect the “tremendous” CRE price growth we’ve seen over the past cycle to continue, and also that “the eventual correction in values will be minimal.”
Eighty percent of those surveyed said CRE values would remain the same next year, while 20% predicted they will increase by 1%. The experts surveyed by Situs RERC also felt that cap and discount rates lately have moved from being “reasonable” to “aggressive,” reversing a trend they’ve seen over the past two years, although they’re expected to remain generally flat over the next 12 months.