US Commercial Property Update Industrial returns have peaked, but will stay strong We think that 2020 will be the eleventh consecutive year of double-digit total returns for industrial property. However, we also think it will be the last in this cycle, as slower yield falls from... 26th February 2020 · 3 mins read
US Housing Market Update Mortgage rates unlikely to hit record lows A flight to safety and belief that the Fed will cut rates have driven the 10-year Treasury yield to record lows. But we doubt the 30-year mortgage rate will follow suit. Stretched lender capacity and... 25th February 2020 · 3 mins read
Virus fears pull down interest rate expectations While the further spread of the Covid-19 virus increases the chance of interest rate cuts, the Bank of Canada seems likely to approach the issue in the same way that it approached the US-China trade... 25th February 2020 · 9 mins read
US Housing Market Data Response Case-Shiller / FHFA House Prices (Dec.) Low mortgage rates and tight inventory have supported house prices in recent months, with Case-Shiller reporting a jump in annual growth to 3.8% in December, a 10-month high. But looking ahead... 25th February 2020 · 2 mins read
US Commercial Property Chart Pack Rental growth coming off the boil in all sectors Economic indicators have improved recently, but remain at low levels, meaning that the recovery in GDP growth is likely to be gradual. As a result, occupier demand is likely to continue to slow... 21st February 2020 · 8 mins read
US Housing Market Data Response Existing Home Sales (Jan.) Given the plunge in the pending home sales index in December, the 1.3% m/m drop in existing home sales in January was smaller than we had expected. But that implies sales will see a more substantial... 21st February 2020 · 2 mins read
US Commercial Property Update Apartment rent growth to benefit from home shortage Rental growth of 3.5% to 4.5% y/y over the next five years is the key reason why we expect apartments will outperform other commercial property sectors. Stretched home valuations, tightening mortgage... 20th February 2020 · 3 mins read
Rail blockades to weigh on first-quarter growth Due to the ongoing protests that have crippled the rail network, we are reducing our forecast for first-quarter GDP growth to 1.5% annualised, from 1.8%. But providing the blockades end soon, growth... 20th February 2020 · 3 mins read
US Housing Market Update Apartment rent growth to benefit from home shortage Rental growth of 3.5% to 4.5% y/y over the next five years is the key reason why we expect apartments will outperform other commercial property sectors. Stretched home valuations, tightening mortgage... 20th February 2020 · 3 mins read
US Economics Update Assessing the risks to our fed funds forecast In contrast to market expectations, we are still sceptical that the Fed will cut interest rates this year, but we agree with Treasury investors that rates are more likely to fall than rise over the... 19th February 2020 · 6 mins read
US Housing Market Data Response Housing Starts (Jan.) The fifth warmest January on record meant housing starts only reversed some of their December surge, with single-family starts remaining above 1 million annualised. That impact will unwind over the... 19th February 2020 · 2 mins read
US Chart Pack Near-term shocks won’t knock economy off course Although the Boeing shutdown and the coronavirus outbreak pose downside risks to the economy in the first quarter, there are mounting signs that underlying momentum in the economy is strengthening. We... 19th February 2020 · 9 mins read
US Commercial Property Update What’s debt got to do with it? The worst commercial real estate busts have tended to follow a ramping-up in lending activity, driven by the availability of debt rising and its cost falling. However, regularly updated Fed lending... 14th February 2020 · 3 mins read
US Housing Market Update Could the coronavirus derail the housing market? The coronavirus is contained in the US, and with Chinese construction imports and non-resident buyers too small to have a meaningful impact, the housing market has so far escaped the virus largely... 12th February 2020 · 3 mins read
US Housing Market Chart Pack Rental vacancy rates set for a small rise in 2020 A decline in apartment completions helped keep rental vacancy rates low over the latter part of 2019. But strong multifamily starts over the past couple of years suggest completions will pick-up in... 11th February 2020 · 8 mins read
Labour Force Survey (Jan.) The further rise in employment, the decline in the unemployment rate, and the sharp rebound in wage growth in January all reinforce our view that the Bank of Canada is unlikely to cut interest rates... 7th February 2020 · 2 mins read