CRE Recovery Begins in Small Markets

August 1, 2012 

Smaller, less expensive properties are becoming more attractive to buyers, according to CoStar’s Commercial Repeat Sales Indices.  

The move toward lower-priced San Diego investment real estate is seen in CoStar’s equal-weighted U.S. Composite Index, which grew year-over-year and picked up momentum over the past six months. 

The equal-weighted index gained 1.0 percent in April, and the value-weighted index lost 2.2 percent, though both are up year-over-year. The report included 774 repeat sales in April and more than 100,000 repeat sales since 1996. The equal-weighted weights each repeat sale equally and is heavily influenced by many smaller transactions, while the value-weighted index measures repeat sales by transaction size or value and is influenced by larger transactions. 

The gain in the equal-weighted index and the decline in the value-weighted index indicates a shift to more transaction activity in smaller, lower-priced properties. The CoStar report also found that for the first time since the recession, time-on-market has declined for for-sale San Diego investment real estate. Additionally, the gap between asking price and final sale price has narrowed in the first four months of 2012 at a rate not seen since 2006. 

Source: CCIM

DISCLAIMER: This blog has been curated from an alternate source and is designed for informational purposes to highlight the commercial real estate market. It solely represents the opinion of the specific blogger and does not necessarily represent the opinion of Pacific Coast Commercial.