Fall in commercial properties and the investment opportunities that this represents.

Since the beginning of 2023 we have seen good numbers in the Miami real estate market. However, not all areas have had the same growth and one of the most affected has been the commercial real estate market.

country context

To understand the drop in sales in the sector, it is important to remember what has happened in recent months. The US government has been raising interest rates, which led to the abrupt closure of two small banks in March, Silicon Valley Bank and Signature Bank. 

As a result of this, a kind of collective panic was generated towards small banks and many clients began to move their assets to larger banks. This strongly affected small institutions, which have increased their interest rates to survive. It is a vicious circle that we have already seen on other occasions. 

In other words, at the country level, there is a reluctance to invest money from small banks, which has directly affected the CRE or Comercial Real Estate. 

Who are the most affected?

The items that are having the most difficulties are retail, restaurants, and hotels. This is because its financing was supported by loans from small banks. 

Today the conditions have changed, loans are more difficult to obtain and have higher rates.

What are the investment opportunities?

The commercial area is something that flourishes in times of economic growth. It is true that in periods of uncertainty people are more reluctant to invest, but any experienced investor can tell you that these periods of decline are the best time for ambitious investments. That is, for those who do not mind waiting patiently for the market to stabilize. Of course, you should know that experts announce that prices will continue to drop before they begin to regularize. 

For that you must be informed, but you can always be attentive to the following publications of Miamiinmobiliario where we will be attentive to the changes that this market presents. 

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