Prices in the commercial real estate market are booming due to strong construction while the residential real estate market sluggishly comes back to life, says Goldman Sachs.
The investment banking behemoth recently completed a study highlighting the differences between the commercial and residential real estate markets, finding the drop-off in construction was less severe on the commercial side—it fell 1.6% while residential construction declined 2.8%. This has allowed prices to recover faster for commercial real estate, HousingWire reports.
In fact, commercial real estate’s quickening pace has some regulators worried. Boston Fed president Eric Rosengren says keeping rates too low for too long may have encouraged excessive risk-taking, leading to unsustainable gains in commercial real estate. [HousingWire]
Strong Construction Pushes Commercial Real Estate Prices Upwards To Historic Peak
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Related Topics:
Boston Fed President Eric Rosengren
, Commercial real estate prices
, Goldman Sachs
, Low rates
, Strong construction
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