Economic indicators that influence real estate markets
Real Estate Market | January 17, 2023 |

Key economic indicators such as economic growth, inflation, and interest rates could give us clues as to how real estate investing will fare in 2023. The following five key Knight Frank metrics will be the most important, and of which they will be most important. Watch the global real estate markets in 2023.

The first indicates that economic growth will moderate. Mainly Europe has already entered a recession and other economies will follow, such as the United States. Mainly Europe has already entered a recession and other economies will follow, such as the United States.

 Most are of the view that growth will be slow, bringing a mild recession by historical standards and thus an opportunity for economies to restart. The cost of debt and inflation weigh on sentiment and spending, the path of which is discussed below.

Check here: Even with low vacancy, industrial demand in Guadalajara grew by more than 30% in 2022

The path of inflation will be another important factor determining the course of interest rates, and the results will affect global asset prices. Central banks like the Federal Reserve have minimized the impact of inflation, so they will double down on their commitment to control it. So far, this resolution appears to be working and peak inflation is behind us.

Interest rates are also projected to peak in the first few months of 2023. As inflation returned to double digits, 2022 marked a rapid and seismic change in the monetary environment, as policymakers grappled with levels of Taller. In general, we are entering a new rate fixing phase where the increases will be of a lesser magnitude.

As for unemployment, the projections indicate that it will increase, but marginally.

Many economies are starting this new cycle with a relatively strong labor market. In the G7 economies, the average unemployment rate was 5% according to the latest statistics, compared to almost 6% a year

Of interest: CDMX recovers 81% of corporate demand in 2022 compared to the pre-pandemic period

Combined with some more savings in pre-pandemic bank accounts, it indicates that the economic downturn could be shorter and shallower than previous cycles, which would be positive for residential markets.

Finally, it is also the loss of ground by the US dollar. At its peak, which was in early November, the dollar's annual gains exceeded 10% against other currencies. The explanation for this was the previous rate hike by the Federal Reserve, as well as the safe haven status of the currency. While dollar and currency-pegged denominated buyers have had the purchasing power advantage in 2022, this could be seen starting to reverse slightly in 2023, Knight Frank concluded.

In Solili you can consult industrial warehouses available in Monterrey, Saltillo and Ciudad Juárez

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