Fed Beige Book: CRE Activity Consistent with Previous Reports

by CoyDavidson on November 29, 2017

Current Economic Conditions by Federal Reserve District – November 17

Economic activity continued to increase at a modest to moderate pace in October and mid-November, according to anecdotal reports from contacts across the 12 Federal Reserve Districts. There was a slight improvement in the outlook among contacts in reporting Districts.

Real Estate

Residential real estate activity remained constrained, with most Districts reporting little growth in sales or construction. By contrast, nonresidential activity (Commercial Real Estate) was consistent with previous reports of slight growth.

Federal Reserve Bank of Dallas

The Eleventh District economy continued to expand at a moderate pace over the past six weeks. Manufacturing output strengthened, and activity in non-financial services increased. Retail sales growth continued but at a slower pace as the post-hurricane auto sales rush abated somewhat. Home sales rose during the reporting period. Loan demand was flat, and energy activity was largely unchanged. Crop conditions remained mostly favorable. Employment, wages and prices continued to increase, and widespread reports of a tight labor market persisted. Outlooks remained positive overall, and generally a bit more optimistic than in the prior reporting period.

Construction and Real Estate

Home sales rose during the reporting period, although the pace of growth varied across regions. Contacts in Houston generally noted a rebound in sales activity following Hurricane Harvey, but there were some reports of weakness in areas affected by flooding. Respondents in Austin and Dallas-Fort Worth (DFW) reported slowing in the pace of sales growth, which some contacts in DFW attributed to buyers concerned about changes to immigration policy.

The apartment market was slowly returning to a normal pace of growth following a few years of above-average expansion, according to contacts. While overall conditions have improved in Houston’s apartment market following Hurricane Harvey, one contact said rent concessions have slowly started to creep back in some areas where there is a plethora of new supply.

The office market remained mostly weak in Houston, despite a decline in sublease inventory and a pickup in investment sales activity. Office demand was solid in Dallas, and industrial market activity was reported to be stable in both Houston and Dallas.

Fed Beige Book- November 2017 by Coy Davidson on Scribd

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