The anguishes of US property market seem to be unending. Though many evaluators and common listeners prefer to differ to this, they may consider the latest evaluation of Real Capital Analytics Inc. What does it state? As per the study, commercial properties in the U.S. valued at more than $108 billion are now in default, foreclosure or bankruptcy, almost double than at the start of the year.
It has also been stated, by the New York-based real estate research firm, that there were 5,315 buildings in financial distress at the end of June and this happens to be twice the number of troubled properties at the end of 2008. However the existing condition of hotels and retail properties is more appalling and they, hence, have been regarded among the most “problematic” assets following bankruptcy filings by mall owner General Growth Properties Inc. and Extended Stay America Inc. The scarcity of credit is causing property defaults in all regions and among every investor type, Real Capital said.
Let’s concentrate on the report. It clearly stated, “Perhaps more alarming than the rapid growth in the distress totals is the very modest rate at which troubled situations are being resolved.” About $4.1 billion of commercial properties have emerged from distress, according to Real Capital. “In far more situations, modifications and short-term extensions are being granted, but these can hardly be considered resolved, only delayed,” the study said.
What conclusion can be drawn from here? The US property market is suffering owing to the ongoing downturn (though of lesser intensity) and its bid to ravage the entire business scenario. Though the government and business persons leave no stone unturned to develop this hapless situation, the same condition continues to exist.
How long may this continue? There is no straight answer to this yet but it is definite that there is no respite soon.
0 Responses
Stay in touch with the conversation, subscribe to the RSS feed for comments on this post.