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Tonight I joined the CCIM group in the Sacramento district to learn about trends in our State’s capital. An expert panel of three lenders shared their insights as to the capital markets and what is driving… or not driving the economy. In a nutshell, the gap analysis I presented many times before was reiterated. Seller’s expectations are not in line with Buyer’s willingness to pay. As Real Estate is a confidence industry, it is no surprise that transaction volume has stalled because of lack of consumer confidence. The recession in the 1980’s was a commercial business led recession and as such business led us out of that recession. This recession is led by the residential lending community and it will take the residential lending community to lead us out of our current recession.

The dreaded “R” word has resurfaced. Banks are returning to RECOURSE loans! Lastly, underwriters are valuating vacancy factors as determined by the market and not by the subject property. So, even if your apartment is 100% occupied- what will matter for the vacancy calculation is the market surrounding your property.

Thank you to my listeners and readers for providing feedback. To learn more about my background, visit Consult Pete. To learn more about my company strategy, visit Commercial MasterMinds.