CMC helps arrange for important access to financing for clients with challenging, complex loan scenarios.
3 Ways a Struggling Real Estate Lending Industry Affects Market Lenders
Recent statistics show a slowdown in residential real estate lending, with some reports indicating that lending dropped as much as seven percent from 2015-2016.
Commercial real estate lending is down even more, declining by roughly 10 percent in that same period. With the trend set to continue in 2017, investors are wondering if they’ll be able to get a commercial property loan.
How Interest Rates Affect Commercial Real Estate
Interest rates have been stable over the past several years, but it’s becoming evident that they’re now on the rise. Commercial real estate investors keep a close watch on interest rates for obvious reasons, but how much does the interest rate really affect them?
For one, borrowing money is much more expensive with higher interest rates. But there are other factors that affect financing for commercial real estate when it comes to fluctuating interest rates. Here are a few.
Investment Properties that See the Greatest Returns
The key to successful real estate investing is finding the properties that reward you with the greatest returns. You should take into account factors like location, marketplace, and demand to truly nail down which properties are the best long-term investments. Investors can also glean insight from history.
Here are some of the best properties to consider when seeking the best return on your investment.
Reasons Not to Worry about Retail Collapse
It’s important to approach any investment with caution. If you’re considering investing in commercial real estate, most commercial property lending companies will tell you the retail industry isn’t looking good right now.
But a good lending company will also tell you the retail collapse is not something you should worry about when it comes to your investment. Retail establishments come and go often, but a concern lately is that big name companies are closing their doors more regularly.
Smart Ways to Break into Commercial Real Estate Investing
Commercial real estate and residential real estate share similarities and differences, both of which investors should be aware of.
Expenses are generally higher with commercial real estate, for example, but can be shared with tenants. A commercial property usually generates more cash flow at the end of the day, so when it comes down to it, the higher expenses aren’t that big a negative.
What a Valuable Investment Property Looks Like
When you secure commercial loans for real estate, you have the opportunity to put that money into a potentially profitable asset. But how can you be sure you’re investing in a valuable property?
When considering a new investment, you should take some time to consider a variety of factors. The worst mistake an investor can make is jumping into a hot property without researching it thoroughly.