The latest report from MSCI Real Assets reveals a decrease in the annual rate of decline for U.S. property prices at the beginning of 2024. According to MSCI, their RCA CPPI National All-Property Index dropped by 4.7% in January compared to the previous year and only slightly decreased by 0.1% from December’s numbers. This is a significant improvement from July and August of last year when prices were plummeting at an alarming rate of around 11%.
Experts believe that discussions about potential interest rate cuts by the Federal Reserve have influenced this positive trend in property pricing, as seen with apartment prices dropping only 7.9% in January compared to a staggering decline of approximately14/1% back in August.
Among all sectors, industrial properties were the only ones that saw growth on an annual basis with a rise of 1/4%. Additionally, industrial prices also increased month-over-month since June last year according to MSCI Real Assets.
Retail properties also showed some signs of recovery as they experienced slight growth (0.l%) on a monthly basis but still fell short on an annual comparison (-3/6%). However, this marks six consecutive months where retail price declines have been moderating.
This report highlights how declines are slowing down for U.S.property pricing across various sectors and can be attributed partly due to talks about possible interest rates cuts initiated by The Federal Reserve.