Housing in Asia and the commercial real estate market in the US

Experts from investment bank – Morgan Stanley & Co. predict a bigger economic meltdown in the US commercial real estate sector than the 2008 financial crisis. These are the expected effects of the pandemic, high-interest rates and the collapse of Silicon Valley Bank, which have strained the sector in recent years. In the next five years, the expected commercial real estate debt will be more than $2.4 trillion in the US.

Although real estate in Hawaii has been very expensive for decades, the rapid increase in house and flat prices in recent years has led to a decline in population and gentrification of society on the islands. Already, most Native Hawaiians live off-island, undermining such Hawaiian values as caring for the land, kuleana (responsibility) and lokahi (cooperation). Currently, the average price of a single-family home is around $1 million in most areas of Hawaii, and only 1,000 to 2,000 units are built there each year.

Since the beginning of 2022,  rents have doubled in Bengaluru, India’s tech hub, which has overtaken Mumbai, the country’s financial capital, among others, in this regard. There is not enough housing in Bengaluru due to the pandemic-induced economic collapse and shortage of labour force. China, meanwhile, is struggling with a huge number of unsold housing units. According to Wind-Data Service, there were approximately 325 million m2 of completed but unsold units in February this year. This amounts to a total of nearly 4 million flats of approximately 81 m2. Most unsold flats are located in smaller cities with populations of a few million people or less.

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