Name: Sectors Up Close: ‘Incredible buying opportunity’ in real estate
Uploaded: 2026-03-30T17:03:46.000Z
Duration: 5 min 12 s
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Adverbs of degree

As the Iran conflict ripples through mortgage markets, is it time to buy, bail, or just buckle up?

This is Sectors Up Close, and we're talking about real estate.

Basic passive voice

Just weeks ago, spring was meant to thaw a property market frozen by high rates and low supply,

but war in Iran has rattled that outlook.

Mortgage rates are climbing again, and builders are sweating over fragile conditions.

So, as the crucial spring season kicks off, will this market be a buyer's paradise or a seller's nightmare?

Well, let's ask Greg Freedman, founder and CEO of Peachtree Group.

So, Greg, mortgage rates have climbed for four straight weeks to a six-month high as the Fed pivots to a hawkish stance.

Is this a short-term spike, or will rates continue to climb?

I think, you know, rates are going to continue to remain in the same range it's been in, you know, the last, you know, call it three to four years, in this four to four and a half percent range.

So I don't necessarily see rates going much higher than where we are today, which, you know, we're slightly below the 10-year is slightly below 4.4%, you know.

But being in this, you know, the range it is in today, you know, the reality is, is it's almost double where it averaged between 2010 and 2022, where it was closer to 2.2%.

Well, commercial real estate was already a headache before the war.

Deutsche Bank highlighted its exposure was a key risk.

So what other factors are keeping the sector vulnerable?

So, you know, besides just interest rates being higher for longer, you know, the reality is, is the fundamentals in commercial real estate are pretty strong here in the U.S.

I mean, there's been a lack of new supply.

I would say that in general, you know, in most cases, real estate is very well positioned.

You have dealt with, you know, some impact on just rising operating costs.

But that's, you know, I think that is a short-term issue.

But in most, you know, most cases, real estate is very well positioned when you think about just the underlying performance of these assets, because demand is, you know, slowly growing across most of the property types,

and supply is, you know, is constrained not only today and over the last couple of years,

but supply is expected to be constrained over the next, you know, over the next three to five years due to the just dislocation here in the U.S.

Well, for investors with capital, the volatile geopolitical landscape is reshaping where they could choose to deploy it.

Could a shift towards backyard investing accelerate the decline of U.S. commercial real estate?

The reality is, is, you know, the last several years has been really hard for investors in real estate, because in a lot of cases, they're not seeing a lot of capital flow back to them because there hasn't been a lot of exits.

You know, people haven't been able to sell assets just due to the higher-for-longer interest rate environment.

I think as you look over the next several years, I think real estate is probably one of the more compelling areas to invest into today, just given the fact that, you know, values are down on average, you know, close to 20%.

And so it's, you know, from our perspective, the, you know, chaos when you look at what's happening in the Middle East today, the conflict there, as well as you look at, you know, what's happened with this higher-for-longer interest rate environment and this wall of debt maturity, I think it creates a, you know, it creates an incredible buying opportunities for those that are well capitalized and able to deploy capital today.

Soaring oil and gas prices have thrust into plain sight the risk investors in commercial real estate face.

It's as if they don't make their buildings less reliant on old-world energy.

So is there a workaround here for financing?

So I think, you know, buildings that are energy efficient, you know, that are utilizing, you know, clean energy and focusing on reducing carbon emission, you can utilize CPACE financing, which, you know, commercial property assessed clean energy financing, which has become, you know, more recognized here in the U.S.

as a, you know, strong tool to finance not only new construction projects, because new construction is probably one of the harder types of commercial real estate projects to finance,

but also to help finance projects that are going through, you know, potentially renovations to become more, you know, become more energy efficient, as well as to, you know, provide retroactive financing, where in a lot of cases, you know, CPACE can be utilized as rescue capital for loans that are maturing.

It is still too early to predict how the market will shake out,

but early signals from homebuilders and construction firms are far from optimistic.

So should we brace for a rough earnings season?

I think it's I think it's going to be challenging to a certain degree.

I mean, as you referenced, you know, homebuilders specifically, I mean, I do think it's, you know, there is demand and there's a housing shortage across the U.S.,

but this, you know, this higher and this spike in interest rates is going to, I think, you know, create a little bit of short-term headwinds for homebuilders.

So I would expect it to be a little bit volatile, just given, you know, the impact of what's happening with the conflict that's created, you know, obviously, you know, creating some, you know, impact on energy costs, as well as putting pressure, upward pressure on, you know, rates.

That was Greg Freedman from Peachtree Group.

Don't forget, you can watch more videos on reuters.com.