- Sales volumes set another record in Q2, but that is unlikely to continue in Q3.
- Our experts note that deals are being re-traded frequently, suggesting that transactional pricing will adjust in the quarters ahead.
- Transactional cap rates have yet to move meaningfully, though industrial rates rose slightly.
- Multifamily drove nearly 50% of all first-half volume. As multifamily goes, so goes the broader market.
- Higher borrowing costs and still-low cap rates create a negative leverage situation, which buyers and sellers are still working through.
Investment sales volume remained strong in Q2, coming in 18% higher than one year ago, setting a new all-time record for sales volume over a four-quarter period, bringing in more than $905 billion in the past year. But the pace of annual growth has slowed, transactions are taking longer to complete, and re-trades are becoming common. Transactional data from Real Capital Analytics has yet to show meaningful changes in pricing (all property type pricing appreciated in Q2, save for hotel). However, our boots on the ground suggest that pricing has fallen across asset classes.