Real Estate & Construction News Roundup (7/17/24) – Housing Inflation to Remain High, Proptech Investment to Fall and Office Vacancy Rates to Reach Peak in 2025
In our latest roundup, construction backlog to see positives signs, regional banks to be conservative on buybacks, U.S. metro areas to permit few new housing units, and more!
- Venture capital investments in proptech and adjacent companies fell 14.3% in the first half of the year. (Leslie Shaver, Multifamily Dive)
- The expectation of interest rate cuts by the Federal Reserve later this year due to easing inflation and cooling economic growth is a positive sign for construction backlog. (Sebastian Obando, Construction Dive)
- The U.S. office real estate sector is now in three markets, each with different performance, but the overall office vacancy rate will reach a 21.6% peak in the second half of 2025. (Nish Amarnath, Construction Dive)
- U.S. regional banks to stockpile more rainy-day funds and stay conservative on stock buybacks as losses from commercial real estate (CRE) loans are expected to pressure their earnings. (Manya Saini, Reuters)
- Higher interest rates for loans are slowing new home and apartment construction as U.S. metro areas are on track to permit fewer new housing units than last year. (Sami Sparber and Kavya Beheraj, Axios)
- Housing inflation has remained stubbornly high even as inflation in the broad U.S. economy has cooled significantly from peak levels during the pandemic era. (Greg Iacurci and Ana Teresa Solá, CNBC)
- Home prices reached a record in late spring, but inflation overall has slowed, and the Federal Reserve at its latest meeting signaled just one rate cut before the end of year. (Jeff Ostrowski, Bankrate)
