By now everyone is well aware of what has been going on in the real estate markets. The subprime debt market has had its effects in every industry and most directly on the big financials. The residential real estate market is the obvious point of pain. But recently I have noticed that the commercial markets have started to soften.
What this means is that big developers are finally starting to let go of valuable property. In some areas we haven't seen available good pieces of land at attractive prices for probably a decade. But now I am seeing signs that there will be some opportunities for people who want to develop properties.
The difference between the residential meltdown and a commercial slowdown is that the residential markets are directed by the average home investor, most of which are not that savvy. The commercial market has a lot of pros and REITs that have a lot of cash that they could put to work. What this means is that as things start to become available, I don't think you'll see a "crash" mentality that we've seen in the housing market. The sharks will circle good deals for a while before they get gobbled up. But the point is that they will get gobbled up.
There are deals that will start to appear that will pencil in at nice profits even with 3 and 4 year holding periods. One of the great things about economics is that with every boom and bust cycle there is always another wave of opportunity for people to create new wealth.
