February U.S. commercial real estate transaction activity appeared soft on the surface, but Goldman analysts believe the weak initial print will likely be revised meaningfully higher. The most notable area of weakness in last month’s transaction data was across the retail space, which is not especially surprising as the K-shaped economy continues to pressure lower-income consumers.
Goldman real estate analyst Julien Blouin wrote Wednesday that the initial February reading on CRE transaction volumes showed a 13% year-over-year decline. He noted that transaction data from MSCI Real Assets is typically "revised materially higher" and said the early print is not a major cause for concern.
Blouin added that prior months were revised higher by roughly 24% to 25% on average, suggesting the final February reading will likely show transaction growth in the high single-digit territory once the data is finalized.
February Transaction Volumes
Volumes are muted and well below Covid surge. Need rates lower.
Deal activity is improving in some areas, especially office and industrial. Multifamily faced a much tougher comparison versus the same period last year, so the decline looks a lot worse than the underlying trend. The sharpest drop in CRE transactions was in retail, which includes shops, strip malls, convenience stores, restaurants, and malls.
CRE bucket breakdown for February:
Multifamily/apartments: down 24% year over year
Office: up 9%
Industrial: up 15%
Retail: down 61%
Retail CRE volumes plunged
Blouin did not get into the details of the slump in retail deal activity, but it does appear buyers may still be selective in retail, due in part to the K-shaped economy, which is pressuring lower-income consumers’ ability to go out and spend at restaurants and shops.
The takeaway is that the sharp drop in retail CRE transactions likely reflects buyer caution around consumer-exposed properties, given everything we know about the K-shaped economy.
Nearly 10% of rent-stabilized properties in New York City are run down, it was revealed Thursday — as landlords claimedMayor Zohran Mamdani’s promised rent freezewill only make it harder to get those units up to snuff.
Members of the city’s Rent Guidelines Board said at their first meeting of the year Thursday they expect to approve the rent freeze in May, fulfilling a key campaign promise of the new, democratic socialist mayor.
Brian Hoberman, the RGB co-research director, told the board that 9.2% of rent-stabilized buildings were considered distressed, slightly fewer than last year’s 9.3%.
“Since 1990, when 13.9% of stabilized properties were considered distressed, the proportion of distressed buildings declined to as low as 4.9% in 2016,” said Hoberman.
“Subsequently, distress rates rose. So by 2022, the distressed rate was up to 9.8% and since falling over the last two years to 9.2%,” he said.
A rally before the Mamdani administration’s “Rental Ripoff” hearing at Fordham University in The Bronx on March 11, 2026.Getty Images
Hoberman claimed that: “Revenues generally exceed operating costs, generating funds that could be used for mortgage payments, improvements and pre-tax profit.”
But Christine Smyth, an owner representative on the board who was appointed by former Mayor Eric Adams, argued the financial state of these buildings was much more dire.
The tally only includes nearly 18,000 of the 50,000 buildings since ones with 11 units or fewer are not required to report finances to the city.
The distressing stat comes after Mamdani campaign that was based around freezing the rent for New Yorkers is stabilized apartments.
The board is set to cast its first vote on the freeze in early May.
Former Mayor Bill de Blasio’s administration froze the rent three times during his tenure starting in 2015 — just as the percentage of distressed properties started to tick up each year.
De Blasio heralded the board’s decision in 2017 after the two consecutive rent freezes, saying, “I’m very proud that the board made that decision.”
“That’s never been done in history before,” he said, adding, “That happened under this administration because I instructed the Rent Guidelines Board — I name the members — and I instructed them to not follow the biases of the past, but be respectful of the needs of tenants and not just the needs of landlords, and look at all the facts.”
The United States Federal National Mortgage Association (Fannie Mae) is set to accept mortgages backed by cryptocurrencies soon, the Wall Street Journal reported on Thursday.
The media outlet explained that home buyers will get a chance to make a down payment using Bitcoin, as well as other virtual currencies. However, once a digital currency has been pledged, it can no longer be traded.
Better Home & Finance, alongside Coinbase Global Inc., will be unveiling a new mortgage product later today that will allow customers to put their crypto holdings to use when purchasing a Fannie-backed mortgage.
Mayor Zohran Mamdani is continuing the legacy of his predecessor Eric Adams by formally appealing a City Council-led expansion of the Big Apple’s housing voucher program — a reverse of a campaign promise.
On Tuesday, Mamdani filed his appeal in the state’s highest court, claiming that the council was attempting to “commandeer” authority over the program, known as CityFHEPS.
That 2023 law would lower requirements to entry and also increase income eligibility, and could bring in up to 50,000 new families to the rental voucher program at a cost of over $10 billion in the first five years.
While city lawyers decry the state of the “woefully underfunded” program, they say the move usurps the authority of city agencies to allocate public assistance.
City lawyers claim the council’s law violates the “interconnected and inextricable chain of authority” between the city and the state, and are not allowed to write their own rules due to this “unique structure.”
“We have no doubt about the Council’s good motives, but the local laws are invalid,” the brief states.
Fannie Mae and Freddie Mac have begun placing sizable orders to purchase mortgage-backed securities, stepping into a market roiled by widening bond spreads amid a surge in volatility, according to a person with direct knowledge of the matter.
The government-controlled entities are moving to capitalize on a sharp selloff while expanding their already significant portfolios of bonds and loans, said the person, who asked not to be identified discussing confidential information. Their efforts follow a directive two months ago from President Donald Trump instructing the pair to acquire $200 billion of MBS as part of a push to bolster housing affordability.
Despite falling mortgage rates, analysts expected December's drop in new home sales to accelerate in January... and accelerate they did... crashing a stunning 17.6% MoM (-2.7% MoM exp) - the biggest MoM drop since July 2013.
This huge MoM drop dragged sales down 11.3% YoY - the worst slide in three years...
Source: Bloomberg
This huge drop dragged the new home sales SAAR down to its lowest since 2022, catching down to existing and pending sales...
Inventories are up (Houses for sale in Jan. rose 0.4% m/m to 476,000), prices are down (Median down 6.8% YoY at $400k - lowest since 2024)...
...and remember these deals were signed in January - meaning this is not mortgage related (some suggesting weather impact - Northeast sales down 44.7% MoM, MidWest -33.9% MoM, but the scale is immense).
Of course, the future could get pretty dark as mortgage rates have surged since the war in Iran began...
...so much for helping 'affordability'. Looks like homebuilders are going to be 'incentivizing' a lot more soon.
Renters across the United States may be able to save a bit more on apartment leases this month, as rents nationwide hit a four-year low last month, marking the 30th consecutive month of declines.
In its February Rental Report issued on March 17, Realtor.com recorded that the national median rent was $1,667, with 15 major markets posting rents more than 10 percent below their pandemic-era peaks.
The median rent for studio, one-bedroom, and two-bedroom apartments fell last month to its lowest level since March 2022. Nationally, the median rent fell by $29, or 1.7 percent, from a year earlier. While rents remained 14.2 percent higher than pre-pandemic levels in February 2020, they were $90, or 5.1 percent, lower than their peak in the summer of 2022.
“The persistent softness we’re seeing is increasingly translating into real savings for renters who, for a long time, felt the market was out of reach,” Danielle Hale, Realtor.com chief economist, said in the report.
Hale noted that rents typically skew lower during the winter months but are expected to rise slightly as spring approaches.
“For some areas, this will likely mean new rental price highs, even as renters in the Sun Belt continue to see notably lower rents,” she said.
Lower rents in the South were attributed to a continued boom in multifamily construction. Atlanta, Georgia, has seen 42 consecutive months of year-over-year declines, followed by Phoenix, Arizona, and Las Vegas, Nevada, both have had 41 months of decreases.
The median rent for all apartment sizes in Atlanta last month was $1,543—a 2 percent year-over-year decline. Renters in Phoenix saw a median price of $1,247, a 4.4 percent year-over-year drop, and renters in Las Vegas experienced a median price of $1,423, a 1.8 percent decrease.
According to the report, the national median rent for two-bedroom apartments declined by nearly 2 percent year over year in February, to $1,844 per month. One-bedroom apartments had a median rent of $1,548, and studios $1,393.
Oklahoma City offered the country’s lowest median rent at just $983 for all apartment sizes. Median rent in Birmingham, Alabama, came in at $1,125 last month, and in Columbus, Ohio, at $1,190. Other metros with median rents under $1,500 include Austin, Memphis, Nashville, Raleigh, and Jacksonville.
Three California metros had some of the country’s highest rents in February, with the San Jose-Sunnyvale-Santa Clara metro topping the list with a median rent of $3,331—nearly a 2 percent year-over-year increase, and the 28th consecutive month in rent growth. San Francisco’s median rent was $2,768, while the San Diego metro saw a median rent of $2, 626.
Conversely, rents increased in five metro areas in February, settling just 3 percent below their all-time highs. Virginia Beach experienced a 4.5 percent hike in the median price, to $1,620. Baltimore, Richmond, and San Jose also saw unusual spikes in median rents. While rents were relatively low in Kansas City, Missouri, at $1,387, the metro experienced a larger-than-usual rise.
“We are seeing two different stories across the country,” Realtor.com economist Jiayi Xu said in the report.
“As the spring season approaches, these markets are poised to resume an upward trajectory and push toward new all-time highs.”
A mid-February report by RentCafe predicted a mix of metro areas in the mid-Atlantic, Midwest, and South will be “hot spots” for the spring market.
Cincinnati ranked number one as the most sought-after city by renters, jumping 10 spots from 2025. The rise in its popularity was attributed to the city’s robust job market, revitalization of downtown neighborhoods, and riverfront development. Potential renters showing interest in the city were mainly from Columbus, Chicago, and New York City.
Atlanta, Minneapolis, Washington, DC, and Baltimore also made the top 5 list of popular rental cities. Even with its sky-high rents, San Jose earned seventh place on the list, due to its reputation as a tech-hub hotspot.
The only Northeast location to make the list was Philadelphia, drawing prospective renters mainly from New York City and Boston.
