Record Crowd Hears Moderately Positive Forecast From E.V. Williams Center for Real Estate
March 17, 2017
After a presentation by Old Dominion economist Vinod Agarwal, which warned that forecasting is a challenge under the new presidential administration, attendees at the University's 22nd annual Hampton Roads Real Estate Report and Forecast heard a cautiously optimistic report about the year ahead.
A record crowd of several hundred gathered at ODU's Ted Constant Convocation Center to hear presentations from industry leaders on market sectors like single family, commercial and real estate financing.
Agarwal, who leads Old Dominion's Economic Forecasting Project, led off with a presentation outlining three possible scenarios for the local economy depending on which policies are enacted by the Trump administration.
A big variable in the local market is the slowdown in defense spending over the past five years, Agarwal said. He emphasized that point with a slide that showed how Department of Defense spending increased 6 percent per year between 2000 and 2012.
"Those times have gone, my friends," Agarwal said, adding that a $54 billion increase in federal defense spending promised by President Trump could reverse that trend.
With that uncertain backdrop, speakers from different market sectors spoke about the past year, and about their expectations for 2017. The influential annual report, produced by Old Dominion's E.V. Williams Center for Real Estate, is widely respected because its chapters are written by local leaders in each industry sector.
J. Scott Adams, regional president of the mid-south region with CBRE, delivered the real estate investment report. He suggested conditions are ideal to invest in the real estate market, with stocks at unprecedented highs, and interest rates just starting to rise after a long, flat period.
"In terms of commercial real estate, the time is now," Adams said.
Van Rose, president of Rose & Womble Realty Co., delivered the residential forecast, as he has for the past several years. Rose, whose colorful speeches traditionally wrap up the experts' presentations, described the outlook for residential real estate as the best it has been since before the Great Recession of 2007 to 2009.
"We had a great deal of ground to recover," Rose said. "The past three years have seen steady growth; the next three to five are going to be incredibly strong."
The event concluded with Nancy Dove, managing director of Valbridge Property Advisors, delivering the findings of the Hampton Roads Sentiment Survey, a quarterly questionnaire given to influencers in the local real estate market.
The sentiment survey was brought to Old Dominion in 2015 by Andy Hansz, the Robert M. Stanton Chair of Real Estate, as an effort to regularly gauge the mood of key players.
The most recent findings indicated a few changes in the sentiment of local industry experts. Dove reported that in every sector, feelings are more positive than negative, with marked improvement in the outlook for the multi-family residential market. Another notable change in the sentiment survey is a gradual shift among market players to consider the issue of sea level rise - something the local real estate market will have to deal with in the future, Dove said.