How the Current Economic Climate Impacts CRE
Why GDP Forecasts Shifted and Implications for CRE
Major Firms Raise GDP Forecasts for 2023
The Blue Chip Economic Indicators report released in February shows lifted growth expectations in 2023
Only two economists in the report are forecasting negative growth this year, down from 7 last month
Does The Shifting Outlook Point To A Soft Landing?
While sentiment is rising, it is still possible for the economy to reach a recession and achieve modest growth during 2023
Positive economic indicators like rising retail sales and labor expansion suggest the economy is healthy, but could also sustain more persistent inflation
How will this Impact CRE Investors
Right now, we are expecting a 25-bps lifts to the Fed Funds Rate each of the next two meetings, but if Fed officials think the economy is running too hot, they could utilize another 50-bps lift
Smaller lifts give CRE markets more time to react to conditions, while a larger lift could create a disconnect between buyer and seller while the market recalibrates
*Through February 2023
Sources: Marcus & Millichap Research Services, BLS