Real estate investment sales data is in from 2020 Q3 and the results are cautiously encouraging. There is still a great deal of market, political and public health uncertainty, but the real estate industry is climbing back up from the depths of Q2. I sat down with my partner Victor Sozio, Executive Vice President, to discuss the current situation and the outlook for Q4 and beyond.
The Current Outlook
Transaction volume, dollar volume and cap rates right now look very similar to 2009 and 2010. Higher cap rates generally signal more risk. If the rate goes up, the value of the property is less when compared to the potential income you can make from it. While this sounds like a good thing, it also signals that property is less of a sure investment.
The difficulty of drawing conclusions right now, though, is that