Economic Experts Predict Uptick In Commercial Real Estate In 2021

As states and cities in the United States relax restrictions caused by pandemics, economists believe much of the pent-up demand and consumer savings will be pumped into the economy during the pandemic in 2021, according to reports from speakers for the Commercial Economic Economy Issues and Trends Forum held as part of REALTORS Legislative Meetings & Trade Expo 2021.

“Economic expansion and job recovery will lead to an increase in occupancy in all types of commercial property,” said Lawrence Yun, chief economist with the National Association of Realtors. “However, overall consumer price inflation is expected to rise 3% by the end of 2021 and remain stubbornly high through next year, which will push interest rates to 3.5%.”

Yun also believes that the housing and rental markets will regain a foothold in line with the recovery of the broader economy, and particularly urban areas across the country.

“The housing sector experienced sudden fluctuations in occupancy – falling abruptly in the first few months of the pandemic and then rebounding strongly in recent months – but we expect vacancies to fall and rents to rise,” Yun said. “The industrial sector has been the star throughout the pandemic. There has been a great demand for industrial space, and remodeling some abandoned properties like older shopping malls can help meet that demand.”

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