Respondents to RCLCO’s latest Market Sentiment Survey are feeling less optimistic than they were six months ago, but most still see continued stability in market conditions for the near to medium term. Nearly two-thirds (65 percent) of respondents believe the next U.S. real estate market downturn will not begin until at least 2019, and current sentiment remains more positive than it was 12 months ago.

Respondents predict that maturing but stable conditions will continue for at least the next year for most real estate product types. Nonetheless, they remain vigilant about when markets tick over from late-stable to early-downturn conditions and how much upside remains. Sentiment suggests the apartment and retail sectors may be the first to peak.

The survey also found the following:

  • Nearly 40 percent of respondents predict multifamily housing will be past its peak within the next 12 months—but this is roughly the same result as that in the year-end 2016 survey.
  • Retail outpaced any other land use in moving closer to peak conditions, and 31 percent of respondents expect a downturn within the next 12 months.
  • RCLCO’s outlook is consistent with that of the majority of survey respondents, who expect the current expansion to continue for the next 18 to 24 months, albeit with increasing levels of uncertainty and risk of volatility as the current cycle moves closer to peak conditions.