The TreppWire Podcast: A Commercial Real Estate Show
287. Hope is Not a Strategy: CRE Extend & Pretend, Home Mortgage Rates, & Hot Hitting Stories
Nov 1, 2024
This discussion dives into the latest economic data, spotlighting mixed results in GDP and consumer spending. The rising home mortgage rates heavily impact homebuilders, prompting strategic shifts. An insightful comparison reveals LA's commercial real estate thrives post-Dodgers' World Series win. The 'extend and pretend' strategy emerges in managing troubled loans, with both risks and potential restructurings. Lastly, trends in industrial real estate transactions highlight vibrant market activity across various states.
47:52
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Quick takeaways
- The recent mixed economic indicators point to a cautious growth trajectory, with falling job openings and Treasury yields reflecting a softening labor market.
- Home mortgage rates have surged above 7%, creating challenges for homebuilders and potentially constraining sales as the fourth quarter approaches.
Deep dives
Economic Data Overview
Recent economic data presents a mixed picture for the economy, with key indicators such as GDP, jobs, consumer spending, and home sales reflecting varying trends. The GDP growth rate came in at 1.8%, slightly below expectations, while new job openings dropped to 7.443 million, significantly lower than the anticipated 7.98 million. This decline in job openings may signal a softening labor market, causing Treasury yields to decrease. Overall, while household spending remains reasonably healthy, the economy's performance appears to be on a steady but cautious path.
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