Boise MSA Investment Transaction Volume

Navigating Economic Uncertainty: Investment Market Witnesses 89% Slump in Transactions Amidst Rising Interest Rates 

High economic uncertainty has continued to impact the Investment market with sales activity slowing considerably compared to the first half of 2022. Based on disclosed transactions, transaction volume reached $111 million in the first half of 2023. This is down 89 percent compared to the same time period in 2022, which saw $996 million traded. Investment activity is anticipated to remain slow throughout the latter half of 2023, considering the Federal Reserve raised interest rates for the 11th time in July.

The target range is now between 5.25 percent to 5.5 percent, which is its highest level in more than 22 years. Higher interest rates will ultimately keep financing undesirable for most buyers. In addition, the gap between buyer and seller expectations remains a major challenge. Sellers are reluctant to sell below their perceived market value while potential buyers want to feel confident and not weighed down by economic uncertainty before investing. There is money waiting to be invested, but it is a reactionary environment where capital is concerned and it will take time to find mutual ground between sellers and buyers.