Key Insights

Consumers pull back as uncertainty grows. Consumer sentiment dropped 11% in March, marking the third straight monthly decline, as policy uncertainty and inflation fears weigh on confidence. At the same time, inflation expectations surged to 4.9%, the highest in decades, while retail foot traffic fell 4.3% in early March, signaling growing caution among shoppers.

Forever 21 filed for Chapter 11 bankruptcy, planning to shut down its US operations, as yet another retailer succumbs to weakening consumer demand. With foot traffic down 4.3% in early March and inflation concerns rising, more retailers are struggling to stay afloat in a challenging economic environment.

Midwest housing market stays red-hot despite national slowdown.Milwaukee home prices jumped 20% YoY in February, the highest in the nation, followed by Detroit (12.5%) and Nassau County (11.7%), as tight inventory drives competition. With bidding wars intensifying and supply failing to keep up, the Midwest remains a rare stronghold in an otherwise cooling housing market.

This Week in Real Estate: Key Events & Data

Quick Markets

30Y Mortgage: 6.81% (-1 bps)
10Y Treasury Yield: 4.30% (+1 bps)
FTSE NAREIT Index: 771.27 (+1.77 %)
30-day SOFR Average: 4.35%

Market Pulse

Rising inflation expectations and declining consumer sentiment signal mounting economic uncertainty, with weaker retail foot traffic reflecting growing caution among shoppers and potential headwinds for consumer-driven growth.

Consumer sentiment plunged 11% in March – The third consecutive monthly decline, as policy uncertainty and inflation fears erode confidence (NYT)

Inflation expectations rose to 4.9% for the next year – The highest in decades, as consumers brace for persistent price pressures amid economic uncertainty (NYT)

US Retail Foot Traffic Drops 4.3% in Early March – Major retailers warn of weaker sales amid economic uncertainty (FT)

Policy & Industry Shifts

Pulte’s decision to delay Fannie Mae and Freddie Mac’s privatization ensures short-term stability but prolongs uncertainty for investors seeking their exit from conservatorship

FHFA Director Pulte Prioritizes Stability Over GSE Privatization – New chief to focus on fraud prevention and operational efficiency, delaying Fannie & Freddie exit (GlobeSt)

D.C. Faces $1.1B Budget Cut – Proposed federal cuts threaten layoffs, transit funding, and regional infrastructure (Bloomberg)

Residential

The Midwest remains a bright spot in the housing market, with Milwaukee, Detroit, and Nassau County seeing double-digit price gains, while oversupply and rising costs weigh on Texas and Florida home values. Meanwhile, climate risk is reshaping demand, as homes in flood- and fire-prone areas face slower sales and steeper discounts despite broader housing resilience

U.S. Housing Affordability Steady in January – NAR’s index held at 100.7 as median home prices dipped to $402K, but 7.04% mortgage rates kept monthly payments elevated (NAR)

Construction Costs Surge as Tariffs Bite – Nonresidential input prices jumped 9% annualized, driven by rising steel and lumber costs (Bisnow)

Midwest Home Prices Surge on Tight Inventory – Milwaukee prices jumped 20% YoY in February, followed by Detroit (12.5%) and Nassau County (11.7%), as low supply fuels bidding wars (Redfin)

Texas & Florida Prices Fall as Inventory Rises – Austin (-2.7%), Tampa (-1.9%), and San Antonio (-1.7%) saw declines as supply outpaced demand, with Florida hit by high insurance and HOA costs (Redfin)

California Approves 22% State Farm Rate Hike – Move aims to stabilize market after $45B wildfire losses, with State Farm facing $7.6B in claims (Bloomberg)

Trillions in US Homes Face Extreme Weather Risk – Zillow finds $9.1T at fire risk, $7T at flood risk, and $17T at wind risk, with LA, NYC, and Miami most exposed (Zillow)

Rising Unemployment Impacts D.C. Housing – Nearly 12,000 federal job losses drive market uncertainty as new listings tick up but remain historically low (HousingWire)

High-Risk Homes Face Slower Sales, Bigger Discounts – Flood and fire-prone properties are less likely to sell and more likely to close below list price (Zillow)

Industrial

US Trade with Canada & Mexico Hits $134B in January – Mexico led with $69.6B (+7.8% YoY), followed by Canada at $64.8B (+8.6%) (FreightWaves)

Amazon Expands Robotics to Cut Fulfillment Costs – Increased automation slashes costs by 25%, with potential $10B in annual savings (GlobeSt)

Financings

JPMorgan and Monroe Capital Lend $225M for Florida Luxury Tower – Slate Hallandale Beach secures refinancing amid strong rental demand (Bloomberg)

Bravo Capital Trust and Integritas Capital Provide $125M for Office-to-Resi Conversion – Watermark’s project to add rentals and condos under NYC’s 467m tax abatement (Commercial Observer)

WinnCos and Boston Housing Authority Secure $70M for South Boston Redevelopment – First phase adds 94 affordable units in a $1B, 3,300-unit project (Bisnow)

M&A

Steiner NYC Secures $420M Recap for Brooklyn Tower – The deal allows Steiner to buy out JPMorgan Asset Management and take full ownership of the 55-story Hub (MultiHousingNews)

Distress Watch

​​Forever 21’s bankruptcy underscores the continued struggles of retailers facing shifting consumer habits and rising costs, posing further challenges for mall landlords and retail real estate

Forever 21 Files for Chapter 11 Bankruptcy – The US operator of the fashion retailer plans to wind down US operations (Bloomberg)