2018 Capital Flows Year-End Review and Outlook

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The Last Hurrah? U.S. Property Markets Surge but Upswing is Unlikely to Last

As highlighted in Colliers’ 2018 Capital Flows Year-End Review and Outlook Report, U.S. property markets staged a healthy—and surprising—comeback in 2018. Sale transactions surged 15% over 2017, recording the second-highest volume of this cycle and reversing two straight years of declines. Looking forward, we see continued vigor in U.S. property markets on the strength of robust operating fundamentals, economic outperformance relative to every other advanced economy, and still compelling property returns, making the U.S. an attractive investment for off-shore and domestic investors alike.

However, we fully expect transaction volumes to resume moderating, and price appreciation and property returns to continue easing, as the U.S. economy slows this year and especially into the year 2020. Our base case now calls for the U.S. economy to at least temporarily avert recession with a “soft landing,” which should support prices at current levels, but the slowing economy will take some of the loft out of real estate capital markets.

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2018 Capital Flows Year-End Review and Outlook

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