Just released Real Estate Investments Outlook June 2019
At the beginning of the year, growth was well above expectations. The labor market remains strong, with solid wage growth supporting consumer spending. Our economy has been driven by an obliging fiscal policy; its impact should increasingly erode this year, which may have an adverse effect on values of real estate investments.
In the first quarter of 2019 growth was 3.2% . This was the third quarter our economy has grown at a rate above 3% in the last five quarters. Looking at the makeup of quarterly economic growth, domestic demand slowed sharply. Economic growth is expected to decelerate to 2020, but at a very gradual pace.
A recession is highly unlikely in 2019 and in 2020 (as household consumption should continue to benefit from higher disposable income). However, doubts may arise in the coming quarters from fiscal policy, domestic demand under pressure and mixed signals from hard data. We must always keep in mind that lackluster growth could trigger a recession.
Since the beginning of the year, we have observed a calm period in the interest rates, with volatility very subdued. The USD index only rose by 1.35%. The USD currently still has a lot going for it, does better on most growth, inflation, and yields than most other indexes. Its Achilles’ heel remains a squeamish Fed, which has the ability to adjust rates.
A strong outlook on earnings growth, along with manageable wage inflation, would suggest that real estate investment values should remain intact, especially as our monetary policy maintains favorable financial conditions. However, with the renewed trade tensions, the real estate rental investment market could change. Although valuations of the real estate industry appear attractive, we feel that investing in “pockets of opportunity” locations as pointed out in our quarterly newsletter Market Cycles represents a well-balanced risk positioning. Should a proper trade deal between the US and China materializes in the weeks ahead, the prospects of adding potential value should increase.
Another factor that has an impact on the real state investment industry is the price of oil. The rollercoaster has continued after OPEC cut production by 3 million barrels a day, the most significant cut since the Great Financial Crisis. The surprise announcement by the US administration that the US is ending waivers allowing several countries to keep importing Iranian crude has pushed up oil prices to $75 per barrel.
At the end of the day, with low inflation and subdued growth, the central bank has turned more wishy-washy and remains so. Monetary policy is likely to respond to enable economic growth to recover in the quarters ahead. We think the Federal Reserve could cut interest rates if the economy slows materially. Interest rates have a profound an effect on the value of real estate investments. Because their influence on investor’s ability to purchase real estate investment properties (by increasing or decreasing the cost of mortgage capital) is so profound, many investors know that this is one of the most important factors in real estate valuation.
ABOUT THE AUTHOR: Eugene E. Vollucci, is considered to be one of the foremost authorities on real estate taxation and real estate investing and has authored books in these fields published by John Wiley & Sons of New York. He is the Director of the Center for Real Estate Studies, a real estate research organization. To learn more about the Center for Real Estate Studies, please visit our web site at http://www.calstatecompanies.com
Torrance, ca 90503
This release was published on openPR.
Permanent link to this press release:
Please set a link in the press area of your homepage to this press release on openPR. openPR disclaims liability for any content contained in this release.
You can edit or delete your press release Just released Real Estate Investments Outlook June 2019 here
News-ID: 1756565 • Views: 188
More Releases from Calstate Companies
Making Money With Residential Income Properties
LOS ANGELES, CA. You have heard time and time again “If I only had purchased that rental property, I would be worth millions today”. Years ago, I discovered that real estate was the best investment to control risk and create wealth. The Real Estate Digest reports that seven out of ten millionaires made their money in real estate, and Forbes magazine states that there is a three times greater chance
Real Estate Investment Outlook July 2019
LOS ANGELES, CA. The speeding up in GDP growth in the US last year was mainly induced by fiscal policy because of corporate tax cuts. Most of these windfall profits have been used to buy back equities instead of increasing capital expenditure, which will have a negative effect on the real estate industry According to the Bureau of Economic Statistics, buyback programs increased from around 90 billion US dollars at the
How Trump Buys Real Estate
LOS ANGELES, CA. If Donald Trump did, in fact, purchase Russian real estate, he might have employed the following strategies: First, he would acquire a team of experts to help him. Trump understands the old saying: “If you act as your own attorney, you have a fool for a client.” This could also apply to the person who tries to be his or her own property manager, real estate broker, accountant,
More Releases for USD
Agriculture Robots worth USD 3.5 billion market
According to Goldstein Research, the rising demand for agriculture robots is being driven by a numerous factors including global population growth, increasing strain on the food supply and decreasing availability of farm workers in developed countries. Global agriculture robots market segmentation includes products types such as driverless tractors, milking robots, potato sorting system, unmanned aerial vehicles and other. The market for agricultural robots is emerging at a rapid pace, with
Polyurethane Dispersions Market worth USD 2.04 Billion USD by 2020
The report " Polyurethane Dispersions Market by Type (Water-Based Polyurethane Dispersions and Solvent-Based Polyurethane Dispersions), by Application (Coatings, Adhesives & Sealants, Synthetic Leather Production, Fiber Glass Sizing, and Others) - Trends & Forecasts to 2020", The global polyurethane dispersions market is projected to reach USD 2.04 Billion by 2020 at a CAGR of 6.8% between 2015 and 2020. This growth is fueled by the high potential from the textile and
Retail Analytics Market worth USD 5.1 Billion USD by 2020
According to a new market research report "Retail Analytics Market by Business Function (Marketing and Customer Analytics, Merchandizing and In-Store Analytics, Supply Chain Analytics, Strategy and Planning), by Type, by Solutions and by Services - Global Forecast and Analysis to 2020", defines and segments the global retail analytics market on the basis of business function, solutions, services, deployment types, and regions along with providing an in-depth analysis and market size
Metabolomics Market USD 1.24 Billion by 2020
The global metabolomics market is estimated to reach USD 1.24 Billion in 2020, growing at a CAGR of 15.6% from 2016 to 2020, according to a market research report Metabolomics Market 2013-2020, published by iHealthcareAnalyst, Inc. Visit the Metabolomics Market 2013-2020 report at https://www.ihealthcareanalyst.com/report/metabolomics-market/ Metabolomics is the scientific study of chemical processes involving metabolites, whereas metabolome represents the collection of all metabolites in a biological cell, tissue, organ or organism, which
Albumin Market USD 300 Million by 2020
According to a market research report Albumin Market 2013-2020, published by iHealthcareAnalyst, Inc., the global albumin market is estimated to reach USD 300 Million in 2020, expanding at a CAGR of 2.4% from 2016 to 2020. Visit the Albumin Market 2013-2020 report at https://www.ihealthcareanalyst.com/report/albumin-market/ The global albumin market segmentation is based on type (human serum albumin, bovine serum albumin, recombinant albumin), and its applications (drug formulation and drug delivery, vaccines, components
Nanomedicine Market USD 170 Billion by 2020
The global nanomedicine market is estimated to reach USD 170 Billion in 2020, growing at a CAGR of 8.9% from 2016 to 2020, according to a market research report Nanomedicine Market 2013-2020, published by iHealthcareAnalyst, Inc. Visit the Nanomedicine Market 2013-2020 report at https://www.ihealthcareanalyst.com/report/nanomedicine-market/ Nanomedicine is the medical application of nanotechnology that ranges from the medical applications of nanomaterials and biological devices, to nanoelectronic biosensors, and even possible future applications of