The National Association of REALTORS® is teaming up with the U.S. Department of Treasury for a series of workshops to help real estate professionals better assist home owners who are struggling to sell their homes in a short sale.
At upcoming Making Home Affordable “Help for Homeowners” outreach events, real estate professionals will be able to gain greater insight into navigating short sales and also have the chance to meet directly with loan officers on their clients’ behalf for any assistance with challenging transactions.
Those who attend the events will hear directly from lender and loan servicers about the short sale process as well as learn tips to effectively negotiate short sale offers and how to speed up these transactions. Treasury officials will also be present to speak about foreclosure prevention programs, such as the Home Affordable Foreclosure Alternatives (HAFA) short sales program.
By REALTORS® and the Treasury Department working together, “we can improve the success rate for short sale transactions, which will reduce the overall number of foreclosures and benefit sellers, lenders, buyers, and the entire community,” said NAR President Moe Veissi.
The outreach events will be held throughout this year. The next session is slated for Feb. 24 in Tampa, Fla. Additional events are planned for Chicago, Indianapolis, Los Angeles, and Sacramento, Calif. Live webinars will also be available for those who can’t attend in person.
For more information about the “Help for Homeowners” events, visit www.makinghomeaffordable.gov/get-assistance/homeowner-events/Pages/default.aspx or register to attend at www.hmpadmin.com/portal/resources/eventinfo.jsp.
Source: National Association of REALTORS®
Friday, February 24, 2012
Deadline Extended for Foreclosure Reviews
Home owners who’ve undergone a foreclosure and want a review of their case now have a longer time to submit their request. The Office of the Comptroller of the Currency and the Board of Governors of the Federal Reserve announced the deadline has been extended to July 31, which provides an extra three more months to spread the word about the review program.
Home owners who faced foreclosure in 2009 and 2010 may be eligible to request a review from their lender of their case through the Independent Foreclosure Review to see if any errors were made in their paperwork and if they were wrongly foreclosed upon. If errors are found, the home owner may receive compensation or another agreed upon settlement.
Announced in April 2011, government agencies mandated that the country’s 14 largest mortgage servicers hire independent consultants to conduct reviews of foreclosure activity in 2009 and 2010 and to ensure that no errors were made in the processing of the foreclosure.
You can view a list here of the lenders involved in the Independent Foreclosure Reviews.
Source: “Deadline to Request Mortgage Review Extended to July 31,” RISMedia (Feb. 22, 2012)
Home owners who faced foreclosure in 2009 and 2010 may be eligible to request a review from their lender of their case through the Independent Foreclosure Review to see if any errors were made in their paperwork and if they were wrongly foreclosed upon. If errors are found, the home owner may receive compensation or another agreed upon settlement.
Announced in April 2011, government agencies mandated that the country’s 14 largest mortgage servicers hire independent consultants to conduct reviews of foreclosure activity in 2009 and 2010 and to ensure that no errors were made in the processing of the foreclosure.
You can view a list here of the lenders involved in the Independent Foreclosure Reviews.
Source: “Deadline to Request Mortgage Review Extended to July 31,” RISMedia (Feb. 22, 2012)
Critics Push the Fed for More Public Rulemaking Meetings
Since July 2010, when the Dodd-Frank Act became law, the U.S. Federal Reserve has held 47 votes on financial regulations. Of the 47 votes, the Fed only held two public meetings. The other votes were submitted electronically, and the votes were just recently disclosed.
Bipartisan critics say that the closed off rulemaking has made it harder for Congress to hold the Fed accountable and has broken with a long-held tradition of providing the public with insight into how rules are being written and implemented.
"People have a right to know and hear the discussion and hear the presentations and the reasoning for these rules," Former Federal Deposit Insurance Corp. Chair Sheila Bair says. " All of the other agencies which are governed by boards or commissions propose and approve these rules in public meetings. I think it would be in the Fed's interest to do so as well."
There are more votes on the way as the central bank works to reshape the regulatory environment and direct how much capital banks must hold, what kind of trading they can do, and what fees they can charge retailers on debit-card transactions.
The Fed indicates that open meetings are held more often and that growing demands on the governors' time makes it difficult to coordinate schedules. But the recent dissension of Fed Governor Sarah Bloom Raskin to the draft Volcker Rule was not disclosed until Feb. 14, though she has recently said that she was concerned the rule was too unwieldy for banks to comply with and for regulators to enforce.
Fed officials say that many open meetings are formulary and will provide little insight into the rulemaking process, and with 250 separate rule writing projects under way, coordinating schedules for meetings would be difficult. Moreover, each rule is open to public comment for between 60 and 90 days, and Fed officials are called before Congress and grilled on the status of controversial regulations.
Source: "Fed Writes Sweeping Rules From Behind Closed Doors," Wall Street Journal (02/21/12)
Bipartisan critics say that the closed off rulemaking has made it harder for Congress to hold the Fed accountable and has broken with a long-held tradition of providing the public with insight into how rules are being written and implemented.
"People have a right to know and hear the discussion and hear the presentations and the reasoning for these rules," Former Federal Deposit Insurance Corp. Chair Sheila Bair says. " All of the other agencies which are governed by boards or commissions propose and approve these rules in public meetings. I think it would be in the Fed's interest to do so as well."
There are more votes on the way as the central bank works to reshape the regulatory environment and direct how much capital banks must hold, what kind of trading they can do, and what fees they can charge retailers on debit-card transactions.
The Fed indicates that open meetings are held more often and that growing demands on the governors' time makes it difficult to coordinate schedules. But the recent dissension of Fed Governor Sarah Bloom Raskin to the draft Volcker Rule was not disclosed until Feb. 14, though she has recently said that she was concerned the rule was too unwieldy for banks to comply with and for regulators to enforce.
Fed officials say that many open meetings are formulary and will provide little insight into the rulemaking process, and with 250 separate rule writing projects under way, coordinating schedules for meetings would be difficult. Moreover, each rule is open to public comment for between 60 and 90 days, and Fed officials are called before Congress and grilled on the status of controversial regulations.
Source: "Fed Writes Sweeping Rules From Behind Closed Doors," Wall Street Journal (02/21/12)
Former Home Owners Wait for Second Chance
More than 4 million homes have been lost to foreclosure in the last six years, and many of those former home owners are now starting to ask: When can we buy again?
Many banks have guidelines that prevent them from issuing loans to people with a foreclosure or short sale in their credit history in some cases for as much as seven years. That also doesn’t factor in the damage foreclosures and short sales can do to a person’s credit score, and the work former home owners' will need to do to repair it so they’ll have a better chance at qualifying for financing again in the future.
Still, some former home owners, particularly those who foreclosed or did a short sale due to extenuating circumstances like a job loss or illness, are finding the wait may not be as long as they were once told.
"They're probably going to pay a little higher interest rate, but with rates so low, a higher interest rate of 4 percent is not a big deal," Rosa Herwick, a broker and owner of Century 21 JR Realty in Henderson, Nev., told the Associated Press.
The wait-time varies among lenders and government entities. For example, the Federal Housing Administration says former home owners with a foreclosure must wait three years before they can qualify, while Fannie Mae and Freddie Mac require a seven-year wait following a foreclosure.
As for short sales, sometimes these waits can be waived or drastically cut, depending on the borrower’s situation. FHA requires a three-year wait following a short sale, but it may waive that wait if the short sale was due to a job loss.
Also, for borrowers who can come up with a higher down payment on their next home purchase, they may also not have as long to wait. For example, Fannie Mae will reduce the wait from seven years to two years for borrowers who come with a down payment of 20 percent or more.
Source: “Lost Home to Foreclosure but Ready to Buy Again? Prepare to Wait in Lender ‘Penalty Box,’” Associated Press (Feb. 22, 2012)
Many banks have guidelines that prevent them from issuing loans to people with a foreclosure or short sale in their credit history in some cases for as much as seven years. That also doesn’t factor in the damage foreclosures and short sales can do to a person’s credit score, and the work former home owners' will need to do to repair it so they’ll have a better chance at qualifying for financing again in the future.
Still, some former home owners, particularly those who foreclosed or did a short sale due to extenuating circumstances like a job loss or illness, are finding the wait may not be as long as they were once told.
"They're probably going to pay a little higher interest rate, but with rates so low, a higher interest rate of 4 percent is not a big deal," Rosa Herwick, a broker and owner of Century 21 JR Realty in Henderson, Nev., told the Associated Press.
The wait-time varies among lenders and government entities. For example, the Federal Housing Administration says former home owners with a foreclosure must wait three years before they can qualify, while Fannie Mae and Freddie Mac require a seven-year wait following a foreclosure.
As for short sales, sometimes these waits can be waived or drastically cut, depending on the borrower’s situation. FHA requires a three-year wait following a short sale, but it may waive that wait if the short sale was due to a job loss.
Also, for borrowers who can come up with a higher down payment on their next home purchase, they may also not have as long to wait. For example, Fannie Mae will reduce the wait from seven years to two years for borrowers who come with a down payment of 20 percent or more.
Source: “Lost Home to Foreclosure but Ready to Buy Again? Prepare to Wait in Lender ‘Penalty Box,’” Associated Press (Feb. 22, 2012)
Home Sales on the Rise: Ready for Spring Buying Season?
Existing-home sales rose 4.3 percent in January to a seasonally adjusted annual rate of 4.57 million, marking the third gain for home sales in the last four months, the National Association of REALTORS® reports.
“The uptrend in home sales is in line with all of the underlying fundamentals – pent-up household formation, record-low mortgage interest rates, bargain home prices, sustained job creation and rising rents,” NAR’s Chief Economist Lawrence Yun says.
While sales ticked up, inventories of for-sale homes also continued to show improvement, NAR reported. At the end of January, total housing inventory fell 0.4 percent to 2.31 million existing homes for sale, which represents a 6.1-month supply at the current sales pace.
“The broad inventory condition can be described as moving into a rough balance, not favoring buyers or sellers,” Yun says. “Foreclosure sales are moving swiftly with ready home buyers and investors competing in nearly all markets. A government proposal to turn bank-owned properties into rentals on a large scale does not appear to be needed at this time.”
Unsold listed inventory has steadily dropped since reaching a peak of 4.04 million in July 2007. It now is 20.6 percent below where it was a year ago, NAR reports.
Housing Affordability Improves
As home prices have fallen and mortgage rates at all-time record lows, housing affordability is at some of its highest levels on record.
“Word has been spreading about the record high housing affordability conditions and our members are reporting an increase in foot traffic compared with a year ago,” says NAR President Moe Veissi. “With other favorable market factors, these are hopeful indicators leading into the spring home-buying season. We’re cautiously optimistic that an uptrend will continue this year.”
The national median existing-home price for all housing types in January was $154,700, which is down 2 percent year-over-year.
Distressed sales, which tend to sell at steep discounts, continue to hamper home prices nationwide. Foreclosures and short sales accounted for 35 percent of all January home sales, which is up slightly from 32 percent in December.
Still, “home buyers over the past three years have had some of the lowest default rates in history,” Yun said. “Entering the market at a low point and buying at discounted prices have greatly helped in that success.”
Breakdown by Housing Type
Here’s a closer look at how home sales fared by housing type in January:
Single-family home sales: increased 3.8 percent to a seasonally adjusted annual rate of 4.05 million in January from 3.90 million in December. They are 2.3 percent above the 3.96 million-unit pace a year ago. Median price: $154,400 in January, down 2.6 percent from January 2011.
Existing condominium and co-op sales: rose 8.3 percent to a seasonally adjusted annual rate of 520,000 in January from 480,000 in December. They are 10.3 percent lower than the 580,000-unit level in January 2011. Median price: $156,600 in January, up 2 percent from a year ago.
Home Sales by Region
The following is a breakdown of existing-home sales in January by region:
Northeast: increased3.4 percent to an annual pace of 600,000 in January and are 7.1 percent above a year ago. Median price: $225,700, which is 4.2 percent below January 2011.
Midwest: increased 1 percent in December to a level of 980,000 and are 3.2 percent higher than January 2011. Median price: $122,000, down 3.9 percent from a year ago.
South: rose 3.5 percent to an annual level of 1.76 million in January but are unchanged from a year ago. Median price: $134,800, which is 0.3 percent below January 2011.
West: increased 8.8 percent to an annual pace of 1.23 million in January but are 3.1 percent below a spike in January 2011. Median price: $187,100, down 1.8 percent from a year ago.
Contract Delays, Cancellations Remain High
Twenty-one percent of NAR members in January reported delays in contracts, and 33 percent said contracts fell through, according to NAR. The number of contract cancellations remains mostly unchanged from December.
The increase in the past year of contract cancellations or delays has been blamed on more lenders declining mortgage applications from stricter underwriting standards and low appraisals coming in under the agreed upon contract price.
Source: National Association of REALTORS®
“The uptrend in home sales is in line with all of the underlying fundamentals – pent-up household formation, record-low mortgage interest rates, bargain home prices, sustained job creation and rising rents,” NAR’s Chief Economist Lawrence Yun says.
While sales ticked up, inventories of for-sale homes also continued to show improvement, NAR reported. At the end of January, total housing inventory fell 0.4 percent to 2.31 million existing homes for sale, which represents a 6.1-month supply at the current sales pace.
“The broad inventory condition can be described as moving into a rough balance, not favoring buyers or sellers,” Yun says. “Foreclosure sales are moving swiftly with ready home buyers and investors competing in nearly all markets. A government proposal to turn bank-owned properties into rentals on a large scale does not appear to be needed at this time.”
Unsold listed inventory has steadily dropped since reaching a peak of 4.04 million in July 2007. It now is 20.6 percent below where it was a year ago, NAR reports.
Housing Affordability Improves
As home prices have fallen and mortgage rates at all-time record lows, housing affordability is at some of its highest levels on record.
“Word has been spreading about the record high housing affordability conditions and our members are reporting an increase in foot traffic compared with a year ago,” says NAR President Moe Veissi. “With other favorable market factors, these are hopeful indicators leading into the spring home-buying season. We’re cautiously optimistic that an uptrend will continue this year.”
The national median existing-home price for all housing types in January was $154,700, which is down 2 percent year-over-year.
Distressed sales, which tend to sell at steep discounts, continue to hamper home prices nationwide. Foreclosures and short sales accounted for 35 percent of all January home sales, which is up slightly from 32 percent in December.
Still, “home buyers over the past three years have had some of the lowest default rates in history,” Yun said. “Entering the market at a low point and buying at discounted prices have greatly helped in that success.”
Breakdown by Housing Type
Here’s a closer look at how home sales fared by housing type in January:
Single-family home sales: increased 3.8 percent to a seasonally adjusted annual rate of 4.05 million in January from 3.90 million in December. They are 2.3 percent above the 3.96 million-unit pace a year ago. Median price: $154,400 in January, down 2.6 percent from January 2011.
Existing condominium and co-op sales: rose 8.3 percent to a seasonally adjusted annual rate of 520,000 in January from 480,000 in December. They are 10.3 percent lower than the 580,000-unit level in January 2011. Median price: $156,600 in January, up 2 percent from a year ago.
Home Sales by Region
The following is a breakdown of existing-home sales in January by region:
Northeast: increased3.4 percent to an annual pace of 600,000 in January and are 7.1 percent above a year ago. Median price: $225,700, which is 4.2 percent below January 2011.
Midwest: increased 1 percent in December to a level of 980,000 and are 3.2 percent higher than January 2011. Median price: $122,000, down 3.9 percent from a year ago.
South: rose 3.5 percent to an annual level of 1.76 million in January but are unchanged from a year ago. Median price: $134,800, which is 0.3 percent below January 2011.
West: increased 8.8 percent to an annual pace of 1.23 million in January but are 3.1 percent below a spike in January 2011. Median price: $187,100, down 1.8 percent from a year ago.
Contract Delays, Cancellations Remain High
Twenty-one percent of NAR members in January reported delays in contracts, and 33 percent said contracts fell through, according to NAR. The number of contract cancellations remains mostly unchanged from December.
The increase in the past year of contract cancellations or delays has been blamed on more lenders declining mortgage applications from stricter underwriting standards and low appraisals coming in under the agreed upon contract price.
Source: National Association of REALTORS®
Mortgage Rates Inch Up After Record Lows
For the first time in three weeks, fixed mortgages rate moved up from their all-time lows, Freddie Mac reports in its weekly mortgage market survey.
One of the factors leading to higher fixed mortgage rates this week was signs of a gradually improving housing market, Freddie Mac Chief Economist Frank Nothaft says. For example, the Mortgage Bankers Association reported this week that seriously delinquent loans — those 90 days or more past due — and the inventory of foreclosures dropped 5.3 percent by the end of 2011, marking the lowest quarterly share since the beginning of 2009. Also, the National Association of REALTORS® reported this week that existing-home sales in January were at their strongest pace since May 2010.
Here’s a closer look at how rates fared for the week ending Feb. 23:
30-year fixed-rate mortgages: averaged 3.95 percent, with an average 0.8 point, up slightly from last week’s all-time low of 3.87 percent. A year ago, 30-year rates averaged 4.95 percent.
15-year fixed-rate mortgages: averaged 3.19 percent, with an average 0.8 point, inching up from last week’s 3.16 percent average. Last year, 15-year rates averaged 4.22 percent at this time.
5-year adjustable-rate mortgages: averaged 2.80 percent this week, with an average 0.7 point, dropping from last week’s 2.82 percent average. Last year, 5-year ARMs averaged 3.80 percent at this time.
1-year ARMs: averaged 2.73 percent, with an average 0.6 point, also dropping from last week’s 2.84 percent average. A year ago at this time, 1-year ARMs averaged 3.40 percent.
Source: Freddie Mac
One of the factors leading to higher fixed mortgage rates this week was signs of a gradually improving housing market, Freddie Mac Chief Economist Frank Nothaft says. For example, the Mortgage Bankers Association reported this week that seriously delinquent loans — those 90 days or more past due — and the inventory of foreclosures dropped 5.3 percent by the end of 2011, marking the lowest quarterly share since the beginning of 2009. Also, the National Association of REALTORS® reported this week that existing-home sales in January were at their strongest pace since May 2010.
Here’s a closer look at how rates fared for the week ending Feb. 23:
30-year fixed-rate mortgages: averaged 3.95 percent, with an average 0.8 point, up slightly from last week’s all-time low of 3.87 percent. A year ago, 30-year rates averaged 4.95 percent.
15-year fixed-rate mortgages: averaged 3.19 percent, with an average 0.8 point, inching up from last week’s 3.16 percent average. Last year, 15-year rates averaged 4.22 percent at this time.
5-year adjustable-rate mortgages: averaged 2.80 percent this week, with an average 0.7 point, dropping from last week’s 2.82 percent average. Last year, 5-year ARMs averaged 3.80 percent at this time.
1-year ARMs: averaged 2.73 percent, with an average 0.6 point, also dropping from last week’s 2.84 percent average. A year ago at this time, 1-year ARMs averaged 3.40 percent.
Source: Freddie Mac
Commercial Real Estate Vacancy Rates Improve
According to the National Association of REALTORS®’ quarterly commercial real estate forecast, all of the major commercial real estate sectors are seeing improved fundamentals, but multifamily housing is becoming a landlord’s market, commanding bigger rent increases. These trends also are confirmed in NAR’s recent quarterly Commercial Real Estate Market Survey.
Lawrence Yun, NAR chief economist, said vacancy rates are improving in all of the major commercial real estate sectors. “Sustained job creation is benefiting commercial real estate sectors by increasing demand for space,” he said. “Vacancy rates are steadily falling. Leasing is on the rise and rents are showing signs of strengthening, especially in the apartment market where rents are rising the fastest.”
NAR forecasts commercial vacancy rates over the next year to decline 0.4 percentage point in the office sector, 0.8 point in industrial real estate, 0.9 point in the retail sector and 0.2 percentage point in the multifamily rental market.
“Household formation appears to be rising from pent-up demand,” Yun said. “The tight apartment market should encourage more apartment construction. Otherwise, rent increases could further accelerate in the near-to-intermediate term.”
The Society of Industrial and Office REALTORS® shows a notable gain in its SIOR Commercial Real Estate Index, an attitudinal survey of 297 local market experts.
The SIOR index, measuring the impact of 10 variables, jumped 8.3 percentage points to 63.8 in the fourth quarter, following a gain of 0.6 percentage point in the third quarter. The index remains well below the level of 100 that represents a balanced marketplace, which was last seen in the third quarter of 2007.
Most market indicators posted advances in the fourth quarter, but 71 percent of respondents said leasing activity is below historic levels in their market — an improvement from 83 percent in the third quarter. Only 29 percent report there is ample sublease space available.
Office and industrial space remains a tenant’s market — 87 percent of participants feel that tenants are getting a range of benefits ranging from moderate concessions to deep rent discounts.
Construction activity is still low, with 95 percent of experts reporting it is below normal, and 83 percent said it is a buyers’ market for development acquisitions; prices are below construction costs in 78 percent of markets.
Participants are broadly expecting stronger conditions for the current quarter, with two out of three expecting market improvement.
NAR’s latest Commercial Real Estate Outlookoffers projections for four major commercial sectors and analyzes quarterly data in the office, industrial, retail and multifamily markets. Historic data for metro areas were provided by REIS Inc., a source of commercial real estate performance information.
Office Markets
Vacancy rates in the office sector are projected to fall from 16.4 percent in the current quarter to 16.0 percent in the first quarter of 2013.
The markets with the lowest office vacancy rates presently are Washington, D.C., with a vacancy rate of 9.5 percent; New York City, at 10.0 percent; and New Orleans, 12.4 percent.
After rising 1.6 percent in 2011, office rents should increase another 1.9 percent this year and 2.4 percent in 2013. Net absorption of office space in the U.S., which includes the leasing of new space coming on the market as well as space in existing properties, is forecast at 20.1 million square feet in 2012 and 28.1 million next year.
Industrial Markets
Industrial vacancy rates are likely to decline from 11.7 percent in the first quarter of this year to 10.9 percent in the first quarter of 2013.
The areas with the lowest industrial vacancy rates currently are Orange County, Calif., with a vacancy rate of 4.8 percent; Los Angeles, 4.9 percent; and Miami at 7.6 percent.
Annual industrial rent is expected to rise 1.8 percent in 2012 and 2.3 percent next year. Net absorption of industrial space nationally is seen at 40.6 million square feet this year and 57.7 million in 2013.
Retail Markets
Retail vacancy rates are forecast to decline from 11.9 percent in the current quarter to 11.0 percent in the first quarter of 2013.
Presently, markets with the lowest retail vacancy rates include San Francisco, 3.6 percent; Fairfield County, Conn., at 5.1 percent; and Long Island, N.Y., at 5.4 percent.
Average retail rent should rise 0.7 percent this year and 1.2 percent in 2013. Net absorption of retail space is projected at 9.9 million square feet this year and 23.9 million in 2013.
Lawrence Yun, NAR chief economist, said vacancy rates are improving in all of the major commercial real estate sectors. “Sustained job creation is benefiting commercial real estate sectors by increasing demand for space,” he said. “Vacancy rates are steadily falling. Leasing is on the rise and rents are showing signs of strengthening, especially in the apartment market where rents are rising the fastest.”
NAR forecasts commercial vacancy rates over the next year to decline 0.4 percentage point in the office sector, 0.8 point in industrial real estate, 0.9 point in the retail sector and 0.2 percentage point in the multifamily rental market.
“Household formation appears to be rising from pent-up demand,” Yun said. “The tight apartment market should encourage more apartment construction. Otherwise, rent increases could further accelerate in the near-to-intermediate term.”
The Society of Industrial and Office REALTORS® shows a notable gain in its SIOR Commercial Real Estate Index, an attitudinal survey of 297 local market experts.
The SIOR index, measuring the impact of 10 variables, jumped 8.3 percentage points to 63.8 in the fourth quarter, following a gain of 0.6 percentage point in the third quarter. The index remains well below the level of 100 that represents a balanced marketplace, which was last seen in the third quarter of 2007.
Most market indicators posted advances in the fourth quarter, but 71 percent of respondents said leasing activity is below historic levels in their market — an improvement from 83 percent in the third quarter. Only 29 percent report there is ample sublease space available.
Office and industrial space remains a tenant’s market — 87 percent of participants feel that tenants are getting a range of benefits ranging from moderate concessions to deep rent discounts.
Construction activity is still low, with 95 percent of experts reporting it is below normal, and 83 percent said it is a buyers’ market for development acquisitions; prices are below construction costs in 78 percent of markets.
Participants are broadly expecting stronger conditions for the current quarter, with two out of three expecting market improvement.
NAR’s latest Commercial Real Estate Outlookoffers projections for four major commercial sectors and analyzes quarterly data in the office, industrial, retail and multifamily markets. Historic data for metro areas were provided by REIS Inc., a source of commercial real estate performance information.
Office Markets
Vacancy rates in the office sector are projected to fall from 16.4 percent in the current quarter to 16.0 percent in the first quarter of 2013.
The markets with the lowest office vacancy rates presently are Washington, D.C., with a vacancy rate of 9.5 percent; New York City, at 10.0 percent; and New Orleans, 12.4 percent.
After rising 1.6 percent in 2011, office rents should increase another 1.9 percent this year and 2.4 percent in 2013. Net absorption of office space in the U.S., which includes the leasing of new space coming on the market as well as space in existing properties, is forecast at 20.1 million square feet in 2012 and 28.1 million next year.
Industrial Markets
Industrial vacancy rates are likely to decline from 11.7 percent in the first quarter of this year to 10.9 percent in the first quarter of 2013.
The areas with the lowest industrial vacancy rates currently are Orange County, Calif., with a vacancy rate of 4.8 percent; Los Angeles, 4.9 percent; and Miami at 7.6 percent.
Annual industrial rent is expected to rise 1.8 percent in 2012 and 2.3 percent next year. Net absorption of industrial space nationally is seen at 40.6 million square feet this year and 57.7 million in 2013.
Retail Markets
Retail vacancy rates are forecast to decline from 11.9 percent in the current quarter to 11.0 percent in the first quarter of 2013.
Presently, markets with the lowest retail vacancy rates include San Francisco, 3.6 percent; Fairfield County, Conn., at 5.1 percent; and Long Island, N.Y., at 5.4 percent.
Average retail rent should rise 0.7 percent this year and 1.2 percent in 2013. Net absorption of retail space is projected at 9.9 million square feet this year and 23.9 million in 2013.
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