Slow but Steady and the Real Estate Sector

Glenn Rufrano
CEO
Cushman & Wakefield

The US recovery has been moderate since it officially began in June 2009. Employment began to increase at the beginning of 2010 and we have added more than 850,000 private sector jobs through September, or roughly 100,000 per month. Gross domestic product, increased at a 2.0% annual rate in the third quarter, continuing the steady pace of the second quarter.

The economy is not booming because business leaders are facing a range of uncertainties that are making them cautious: The political environment is uncertain with the impending elections; the regulatory environment is not clear with the rules of the health care and financial reform laws just now being written; the tax environment is unclear with an impending increase that may or may not happen. With all this uncertainty, business leaders are more reluctant to take risk. Small business optimism, while up off the bottom remains at historically low levels.

Business leaders are slowly hiring, the employment data demonstrate that, because demand is rising and profits are up. This is likely to continue to be the environment we are operating in for several more months: a moderate economic expansion with slow but steady employment growth.

For us in the real estate industry, this is a big improvement over what was occurring a little more than a year ago. We are already starting to see signs of fundamental stability ahead. Vacancies, particularly in the major cities have begun to turn down and property prices particularly for trophy product in major metropolitan areas are rising. All in all, the US real estate environment has come a long way during the past year, and is likely to continue to improve in 2011.

Glenn Rufrano
CEO
Cushman & Wakefield

3 Comments

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  2. The economic crisis hit real estate sector in usa but now situation is improving slowly and steady.

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