ICOnic News | Investment Properties: Buy, Hold or Sell?
INVESTMENT PROPERTIES: BUY, HOLD OR SELL?
The US economy and real estate market is at a real point of inflection, but where the US goes, the Houston market has a tendency not to follow! The issues facing real estate investments right now with interest rates, inflation, loan maturities and threat of a recession are real, but how significantly are they impacting the Houston investment market? Through 2q2023, Houston’s growth is strong with jobs up 18,500 in May 2023 with growth in almost every sector. Home sales and home construction are increasing, and homebuilders are busy with $864.4 million in single family permits, up from $759.9 million in 2022. Automotive sales are up 24.5% to 340,571 year over year and the labor market is tight with unemployment at 4.4%. So the bottom line is … consumer activity and spending is strong in the Houston market and all of these factors are very positive for the real estate market.
Overall US investment sales through 1q2023 were down 57%, but $78 billion in assets still traded across industrial, office, retail, multi-family and hospitality asset classes and this does not include long-term investors that are parking money into land. The Houston market was the 10th strongest market in the US with investment sales of over $16 billion trading over the last trailing four quarters. In the last half of 2023, we anticipate seeing the largest marketplace weakness in select office towers and older multi-family projects succumb to the pressures that low occupancy and upcoming loan maturities can warrant. This will create unique opportunities for local and foreign investors to purchase these assets at fractions of the replacement cost. All other remaining product types should remain strong, supported by high employment and increased spending, resulting in Houston continuing to be a core investments market.
- Lang Motes, Land and Investment Sales Advisor
BATTLE OF THE MENTORS
To finish off our mentoring program for this quarter we had some friendly competition at Battle of the Mentors. Each team worked together to use their newfound communication skills, patience, and endurance to complete each challenge. This was the ultimate test to see who worked the best together to accomplish a timely goal. Please congratulate Tawnya Dornak and Seth Green on their successful win!
