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Commercial Real Estate

Commercial Real Estate Demand Is On The Rise Throughout The US 

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According to a new index from the National Association of Realtors, a multitude of markets throughout the US are showing an increased demand for commercial real estate throughout the country. 

South Carolina, in particular, ranked the highest among all US states in future potential demand for commercial real estate. The National Association of Realtors works to provide a clear vision for investors throughout America when it comes to pursuing their next big venture. The data they report utilizes figures from local economies and past patterns to predict future demand. 

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This specific index looks at over 300 metropolitan markets, analyzing office, industrial, retail, and multifamily sectors while measuring the economic conditions within each region, CNBC reports. 

Government data from the Bureau of Labor Statistics and the Census Bureau for population and movement also helped inform the rankings. The office sector looked at growth in professional and business services employment. For industrial they looked at manufacturing, transportation, and warehousing employment growth. 

The NAR also measures growth in retail trade along with leisure and hospitality employment. In the multifamily sector, they incorporated population growth and net migration domestically and internationally. 

“It doesn’t say, ‘OK, go there and just buy property,’ but it says … where the data shows that the momentum is building, the demand is building,” Nadia Evangelou, principal economist and director of real estate research at NAR, said. 

The association also compared those selected markets to 2022, which is considered the peak of the pandemic migration boom. According to the index, out of all the markets analyzed, Raleigh, North Carolina is the only major one that is stronger today than it was in 2022. 

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Austin, Texas, Miami and Naples, Florida, once considered to be “superhot” markets, have all declined within the market within the past four years. 

Within the index the strongest metropolitan market is St. George, Utah due to their office employment growth. 

“It also has very strong population growth and in-migration, and its industrial demand is above average,” Evangelou said. 

“So St. George, for example, is the No. 1, because one industry happened to have a good year, so there is a broader momentum over there.”

Evangelou also said that small and midsized markets could provide some of the best opportunities for investors. 

The index also broke down where each of the four sectors is seeing their strongest demand, which includes Salem, Oregon and Fairbanks, Alaska. 

“When we take a look at New York, San Francisco and the big coastal markets, we see that the large markets are still generally weaker than the fast-growing Sunbelt and smaller markets in this index,” said Evangelou.

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Homebuyers In America Were, On Average, Older And Richer Than Ever This Year

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According to a new survey from the National Association of Realtors, in 2024 a record number of Americans were older and utilized an inheritance to help finance buying a new home. 

The survey found that first time home buyers in America were older and wealthier than previous years between July 2023 and June 2024. The report emphasizes a struggle that many Americans are facing when it comes to buying a home. Increasing prices and record-high mortgage rates have remained consistently high.

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According to reports from CNN, first-time homebuyers had an average household income of $97,000, a near $2,000 increase from last year. The average age of first-time homebuyers was also 38, the highest it’s been on record. 

“We’re seeing a dichotomy in this real estate market where those first-time homebuyers are not just your traditional first-time buyers, like schoolteachers or first responders, really entering into the market,” said NAR deputy chief economist Jessica Lautz. 

“The people who can get in are really a select few.”

Within the last year, first-time homebuyers decreased to just 24% of all homebuyers in America. This is the lowest percentage since the NAR began collecting data back in 1981.

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25% of first-time buyers were surveyed to have used a “gift or loan from a relative” to help finance the purchase of their home. 

Lautz said that it’s likely the overall decline in first-time homebuyers using help from family members parallels how they’re also getting older.

“Everyone’s situation is different, but that’s one of the things that seems to be working in conjunction. That seems to be dropping off at the same time as the median age is crawling up,” she said.

The NAR report also showed a major divide with Americans who owned homes during the recent spike in home values and those who are in the market for a home.  

Repeat homebuyers in America have also gotten older on average; the average age increased from 58 to 61 in a year. Repeat buyers also had an increase in average household income, rising to $114,300 from $111,700. 

“The report shows both the struggle in America to secure homes to purchase, and then also people making housing trades with record levels of housing wealth,” Lautz stated.

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Online Real Estate Broker, Redfin, Leaves The National Association Of Realtors

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The online real estate brokerage, Redfin, is now requiring many of its agents to cancel their memberships with the National Association of Realtors (NAR) brought on by allegations of sexual harassment from the association, and other problems within the organization.

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Zillow Facing Antitrust Lawsuit After Accusations Of Favoring Certain Listings 

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A real estate startup company is suing Zillow within a federal court over allegations that the website is violating antitrust laws by “deceptively steering customers to home listings from a subset of agents.” 

The suit was filed in a US federal court in Seattle in which the startup Rex alleges that Zillow and its affiliate Trulia are illegally favoring certain listings by brokers who belong to the National Association of Realtors (NAR); the most prominent US real estate trade association. The startup has claimed that non-NAR real estate agents are now located in a “hidden tab” on the website. 

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Rex’s general council Mike Toth was recently interviewed to discuss the suit regarding one of the nation’s most popular real estate listing websites. “The change by Zillow and Trulia forces all non-NAR listings to have permanent low visibility. This is the real estate web returning to this old vision of data segregation rather than data democratization for consumers.”

The suit could potentially shift the way in which certain online real estate platforms operate and allow more opportunities to arise for more buyers and sellers to negotiate the type of agent they want. Zillow and Trulia account for 75% of the online home search market in America, and when they made changes to their sites in the beginning of January, listings began being segregated to hidden areas of the site. 

“Zillow and Trulia started segregating listings, giving preferential treatment to the 1.3 million real estate agents who belong to NAR. Other listings, including those posted by brokers not affiliated with NAR, foreclosures and homes listed for sale by owners without agents, are now relegated to a separate tab. We are asking the court to block Zillow and Trulia from segregating listings,” Rex claimed. 

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NAR has their own real estate listing site, Realtor.com, which is the second-most viewed site for agents throughout the nation. That platform is known for only showing listings by NAR’s agents, and understandably so considering it’s their own website. So the issue now is that the changes Zillow and Trulia made means that three out of the four most popular real estate listing sites are favored for NAR’s agents and their listings exclusively. 

Those listings in particular tend to be more expensive because they require the seller to pay a commission, often 6% of the homes sale price, which is split between the agents of the buyer and seller. Rex has now raised these antitrust concerns with the Justice Department and 35 state attorney generals. 

Viet Shelton is a spokesperson for Zillow who claims the company “made the change in January after it became a participant in the Multiple Listing Services Internet Data Exchange feeds, which are operated by NAR. Zillow’s rules for the IDX feeds require participants to segregate listings. Zillow is committed to giving consumers the most up-to-date housing information on the most amount of listings possible on a single platform. We made changes to the way some listings appear on the site in order to be compliant with MLS rules.” The suit will likely begin unfolding within the next month or so.