SVN® International Corp. Economic Update – Keeping our clients up-to-date about the latest real estate landscape trends.
The U.S. economy showed mixed signals in July, with inflation accelerating for the third consecutive month, rising 2.7% year-over-year, and core-CPI reaching its highest level in six months at 3.1%. While price pressures increased for vehicles and transportation services, declines in gasoline, fuel oil, and shelter helped keep inflation slightly below expectations—boosting market confidence in a September rate cut. The Federal Reserve kept rates steady during its July meeting but acknowledged growing labor market risks, highlighted by a weak jobs report showing only 73,000 new positions added and significant downward revisions for prior months. Unemployment edged up to 4.2%, with entry-level job seekers facing the largest setbacks in a decade.
In real estate and construction, semi-urban areas led multifamily growth over the past decade, outpacing both urban and suburban markets due to affordability and development capacity. GDP rebounded with a 3.0% annualized gain in Q2 2025, driven by reduced imports and higher consumer spending, while logistics activity softened as inventories adjusted. Industrial construction returned to near pre-pandemic levels, though rising vacancies signaled potential overbuilding. Commercial property prices held steady overall, with retail and industrial sectors posting modest annual gains. Construction spending continued its decline, residential projects falling more sharply than non-residential, while builder sentiment in the single-family sector improved slightly—despite nearly 40% of builders cutting prices to stimulate demand.
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