Real estate investors and developers in California may be interested in learning that the construction of new residential properties around the country dipped significantly near the end of the year. Although residential property building had reached a peak that hadn't been seen in almost a decade in October, November marked significant downswings that revealed the market's inconsistent progress.
While California real estate can be very valuable, many commercial real estate investors may want to search for opportunities in other states. Investors who want to buy low and sell high are looking for markets with reasonably priced properties that have a strong chance of going up in value. Many investors also search for areas that have a robust economy and strong job growth.
Few California investors were surprised when the U.S. Federal Reserve announced on Dec. 14 that interest rates would be increased by a quarter point. Rates dropped to historic lows following the 2008 financial crisis, but several quarters of robust growth have led most analysts to conclude that the era of almost free money is coming to an end. Real estate investment trusts have been extremely popular in recent years because they are required to pass at least 90 percent of their taxable income to shareholders, but even these yields may not be enough to lure investors away from equities when interest rates are climbing and economic indicators are positive.
Commercial real estate investments in California and across the country may bring investors substantial returns during 2017. Despite post-recession high prices for property and the rise in interest rates, commercial properties are appreciating, even passing their 2008 peak, according to market analyst reports. Many advisers also believe that, because of market fundamentals, commercial real estate investments will continue to be a reliable way for investors to build wealth for years to come.
California business owners know that local zoning laws may sometimes create a problem with their plans. Zoning problems may include the building's height, its proximity to another building, setbacks or zoning that does not include the type of business that wants to locate there. However, there are remedies that may be applied that might solve these problems.
People in California who are thinking about buying real estate in 2017 may want to look at some of the trends forecasts for the coming year. Recently, an economic team looked at key economic indicators and market data and used it to come up with a list of trends for 2017. The team predicted that price growth will be moderate, and some buyers will be priced out of the market by higher interest rates.
Spring and summer in California form the busy season for residential real estate sales. The desire to complete a transaction before the start of a school year often motivates buyers and sellers. The slower period between December and February, however, offers buyers the advantages of minimal competition and lower costs.