Market Conditions - June 15, 2006 by Carla L. Davis
The New York Times has reported that the rising costs of fuel and rent are spurring on a jump in the Consumer Price Index, a jump bigger than expected. The Consumer Price Index has risen 4.2 percent. So if rents are rising, what is happening in other real estate markets? Increased demand, and thus decreased inventories, in the commercial sector has given the National Association of Realtors happy news to report. "Rent growth in commercial space is gaining traction, although there is some softness in part of the retail sector. Commercial real estate remains a bright spot in the economy," noted NAR chief economist David Lereah. He did, however, go on the mention that rising interest rates, among other factors, could still have further negative impacts on the market. In terms of the Industrial real estate market, demand is up, along with a healthy rate of new construction. Trade and demand are fueling this decline in inventory, from 9.9 percent in the 4th quarter of 2005, to 9.5 percent. NAR reports that rents in the industrial sector could increase about 1.9 percent this year. And as reported last week by Realty Times, the apartment market is still strong, seeing a decrease in vacancies across much of the nation, showing supply is not keeping up with demand. Rising costs are seen in many regions. | 
