How Rising Interest Rates Impact Commercial Property Sales Prices
Rising interest rates can have a significant impact on commercial property sales prices. As interest rates increase, the cost of borrowing money increases, which can lead to lower demand for commercial real estate. This lower demand can result in a decrease in property values and ultimately, lower sales prices.
Historically, rising interest rates have had a negative impact on commercial property sales prices. During the 1970s and early 1980s, interest rates reached record highs, peaking at nearly 20%. During this time, commercial property sales prices declined significantly. Similarly, during the Great Recession of 2008, rising interest rates contributed to a decline in commercial property values.
