The September CPI Report illustrated a 0.6% monthly increase in core CPI (net of food and gas prices), which came in above expectations. The annual core CPI of 6.6% is the largest jump in 40 years. If you include food and gas, the inflation is over 8.7%!
The Federal Reserve is expected to raise the Fed Funds Rate in the next meeting on November 2nd by another 0.75%. This would set the Prime Rate at 7%. If your loan is coming due or up for a rate increase, you may have to buy down the rate or add additional equity.
If this is the case, you may want to consider selling your property at this time while the returns that Investors are willing to accept are still at the peak of the market. We believe that the Capitalization rates will be increasing over the next several months on all property classifications – prices will adjust due to the capital market.
Sperry Commercial Global Affiliates/RJ Realty is equipped with the skills, expertise, and relationships to solve your needs. Please reach out with any inquiries!