RCA Insights

US Prices Rise 0.7% in September, RCA Report Shows

By on October 25th, 2018

Prices of U.S. commercial properties increased 0.7% in September from a month earlier, led again by growth in the apartment sector, the latest RCA CPPI report shows. The US National All-Property Index increased 7.2% from a year ago.

Price trends in September continued on the relatively consistent path that has been shown throughout 2018 so far. Growth in national prices is being driven by gains in the Non-Major Metros and there is a wider variation in growth patterns among property types this year compared with 2017.

1810 US CPPI_sectors_72

The apartment sector is the only property type still posting double-digit annual price growth. Apartment prices rose 0.5% in September and are up 10.7% year-over-year. As shown in the latest edition of US Capital Trends, which was also released this week, deal volume in the apartment sector is up 12% for year-to-date 2018 compared with the same period a year ago. Transactions of apartment single assets, considered to be the most telling gauge of market health, set a record for the year to date.

Suburban office prices are up 0.4% in September from August and 8.8% from a year prior. Annual price growth for the suburban office sector has accelerated each month since the start of 2018 as investors move out of more highly-priced downtown areas in search of yield. Single asset sales in the suburban office market are on pace to hit a record high level of deal activity in 2018.

To learn more about the RCA CPPI (Commercial Property Price Indices) and to sign up for reports visit rcanalytics.com.  If you are an RCA client you can access RCA CPPI and US Capital Trends reports and conduct your own pricing analysis on the RCA website.