Real estate economists and analysts are expecting a significant turnaround in the national economy and the real estate market within the next three years, according to a new survey by the Urban Land Institute. ULI released the first edition of the semi-annual study – the ULI Real Estate Consensus Forecast – on Wednesday, with the results indicating positive feelings across the industry.
The organization reached out to 38 leading real estate economists and analysts for the inaugural survey, which was conducted in late February and early March. Some of their predictions for the next three years include:
- Vacancy rates are expected to remain stable at low levels for apartments
- Rents are expected to increase for all property types, with 2012 increases ranging from 0.8 percent for retail up to 5 percent for apartments
- The apartment sector as a whole is expected to cool off; rental growth rates are projected to decline to 3.8 percent by 2014
- Single-family housing starts will nearly double by 2014, reaching 800,000 by that point
- Home prices will stop declining this year and begin to rise in 2013, with prices increasing by 3.5 percent in 2014
- Improved job prospects and strengthening consumer confidence will likely bring buyers back to the housing market
Twenty-six economic indicators were considered to reach these conclusions, such as property transaction volumes, vacancy rates and rents for several property sectors, and housing starts and home prices. Growth is compared to levels in 2009 during the height of the recession.
The full report is available from the ULI Resource Library