The Federal Reserve Beige Book released June 4 showed that real estate markets improved unevenly across the 12 districts from April through late-May, but overall lending activity increased nationwide, with roughly two-thirds of the districts reporting rising loan demand particularly in the New York and San Francisco districts.
Reports on residential sales activity were mixed across the country, with some reports of low inventories constraining sales in the Boston, Kansas City and New York districts. Home prices continued to increase across most of the country, while the markets for both condos and apartment rentals mostly were robust. Sales rose modestly in the Atlanta, Chicago, Cleveland, Dallas and Richmond districts, with inventories described as low in Richmond and Chicago, and declining in Cleveland. Sales activity, however, softened in the Minneapolis, Philadelphia, St. Louis and San Francisco districts. About half of the districts reported increased residential construction, but a few indicated some weakening in activity.
Multifamily construction, however, remained particularly robust with the Chicago and Dallas districts reporting strengthening demand for apartment rentals. Additionally, the Boston and New York districts reported significant multifamily development at the high-end of the market.
New home construction also was varied across districts. Residential construction strengthened in the Atlanta, Chicago, Dallas, Kansas City, New York and Richmond districts. However, the Minneapolis, Philadelphia and St. Louis districts indicated some weakening in new home sales and construction. In San Francisco, residential construction activity was mixed but increased activity is expected over the next year.
The commercial real estate market mostly improved since the last report. Leasing activity and vacancy rates strengthened in the Atlanta, Chicago, Kansas City, Minneapolis, Richmond and San Francisco districts, and generally were steady in the Boston, New York, Philadelphia and St. Louis districts. The Dallas district also described market conditions as robust.
Commercial real estate construction activity was steady-to-strong in most districts over the latest reporting period, with strengthening conditions reported in the Boston, Kansas City and St. Louis districts. The Cleveland district described pipeline activity as strong, and the San Francisco district noted that a number of public and commercial high-rise projects have been announced or are underway. In contrast, the Minneapolis district reported a decline in non-residential construction activity, and the Philadelphia district reported steady, low-level activity. The Chicago district described its activity as mixed, with office construction weak but industrial and some retail segments as fairly strong.
Read the latest Beige Book report.