The real estate market in the United States is in a complex but attractive moment for investment. Although global macroeconomic conditions are generating some uncertainty, with inflation at the end of December at 3.4% and SOFR rates of 5.35%, the major investment banks and managers agree that the Sun Belt markets (Florida, Texas, Arizona, among others) are shaping up to be attractive for investment; large investment banks and managers agree that the Sun Belt markets (Florida, Texas, Arizona, among others) are emerging as a great opportunity for investments in the real estate market in 2024. Among the reasons that justify the above we can find a population growth, which is expected to reach a rate of over 1.5% per year during the next decade, exceeding the national average of 0.7%. On the other hand, it represents a dynamic labor market, where the unemployment rate in the Sun Belt is below the national average, with cities such as Austin and Raleigh leading the way in job creation.

Now, going into what type of assets we see opportunities in this specific area of the U.S., we can find multifamily, which is being driven by population growth and internal migration, which means that the annual growth rate of multifamily rent in the Sun Belt is expected to be 4.5% by 2024. Another asset type in which opportunities are seen is industrial, as the rise of e-commerce and the need for warehousing and distribution space has generated exponential growth in demand for this type of property. The absorption rate for industrial space in the Sun Belt is expected to be 7% by 2024.

Finally, and based on the market expectations of large U.S. managers, data centers stand out, which have been driven by the growth in internet usage and the need to store and process large amounts of data. Data center investment in the Sun Belt is forecast to reach $20 billion by 2024.

In conclusion, the U.S. Sun Belt real estate market presents an attractive outlook for investors in 2024, with robust population growth, a diversified economy and high demand for specific property types.

Sources: CBRE, Zillow

Diego Covarrubias

Fynsa AGF Team