Investors in California and around the country who put money into real estate investment trusts enjoyed healthy gains during the first nine months of 2016, but some financial experts believe that REITs will find it difficult to replicate this success in 2017. Through Sept. 30, the S&P 500 provided a robust return of 7.8 percent, but REITs posted an even more impressive 12.6 percent return during the same period. REITs are particularly attractive to investors seeking income in a low-yield environment, but their soaring popularity and rising prices have some analysts concerned.
As members of the millenial generation come of age, many are beginning to enter the real estate market in California and other states. They have grown up with access to massive amounts of information through digital sources, and real estate decisions can be greatly impacted as these young consumers look at buying and selling their properties. Of course, these resources are also greatly used by older generations, but millenials appear to be driving the market.
Real estate investing is a booming industry in California and throughout the U.S., and many investors are looking to put their money into commercial properties rather than residential. While in the recent past, most commercial real estate transactions were handled in person, modern technology is changing the industry, allowing for investors and sponsors alike to make more informed choices.
Soaring house prices in major California markets like Los Angeles, San Diego and the San Francisco Bay Area have left even well-paid workers in those markets with little hope of buying a home of their own, but a group of companies that cropped up in the wake of the 2008 financial crisis are offering them a way to take advantage of cheaper real estate in other parts of the country. These companies strive to provide their clients with steady rental incomes rather than quick turnovers and rapid profits.
California commercial property developers may have noticed an increasing paucity in the loans issued by American banks. An unsettled economic environment and fears of incipient regulation have caused many lenders to withdraw from the commercial property marketplace. This leaves developers with fewer options for the loans they need for their business.
According to a Sept. 27 report by the Urban Institute, banks are starting to offer more home mortgage loans. This may be good news for California residents who are considering purchasing a new property.