Construction and Real Estate - July 2009
Construction and Real Estate
District home sales remained at weak levels in June; however, sales picked up across District markets according to many Realtor reports. Several contacts noted that the $8,000 tax incentive for first-time home buyers may have helped sales, particularly at the low end of the market. Foreclosures and short sales continued to place downward pressure on home prices, but declines appear to have moderated somewhat in recent months. Construction remained at low levels across the District, but recent data indicate that activity may be bottoming out. The outlook among District housing contacts dimmed quite a bit in June, portending weaker year-over-year growth over the next several months.
Commercial development remained weak across the District. Vacancy rates trended up, with greater availability of sublease space reported in some areas. Downward pressure on rents was also reported. Developers continued to report fewer backlogs, and more projects were delayed. Most commercial contacts anticipate weaker activity for the rest of 2009, which will carry over into 2010. Recent data support the view that commercial construction activity will continue to soften.