CRE This Week - What's impacting the United States market?
June 29, 2026 - US commercial real estate news, macroeconomic indicators and market analysis.
Week of June 29, 2026
Welcome to the latest edition of CRE This Week, curated by Altus Group’s US research team.
Our team has handpicked pertinent and noteworthy market indicators, articles, original research, and significant industry dates that are critical to the US commercial real estate sector. We understand that your time is valuable, so we're excited to deliver research that helps you stay informed and saves you some time each Monday morning.
For more key economic indicators that matter to commercial real estate, see Top Indicators by Major Asset Type.
Economic print
Macro economic factors impacting CRE
S&P Global released its flash Purchasing Managers Index data for June on June 23. The Composite Output Index rose to 52.2 from 51.5 in May, a five-month high. The Services Business Activity Index edged up to 51.3 from 50.7, while the Manufacturing PMI climbed to 55.7 from 55.1, its highest since May 2022. Manufacturing strength was largely inventory-driven, as firms front-ran potential supply disruptions tied to the Middle East conflict. Employment fell for the second consecutive month, with factory headcounts cut at the fastest rate since early 2020. Input price inflation remained historically elevated, and selling price inflation held at its highest pace since July 2025.
The headline improvement masks a weak underlying picture. Services at 51.3 is too soft to drive meaningful office or retail leasing momentum, and broad-based job cuts narrow the demand outlook across property types. Persistent input and selling price inflation keeps the Fed's rate path uncertain, limiting near-term relief for floating-rate borrowers. Manufacturing's inventory-driven surge may provide a short-term lift to logistics demand, but it is not a durable signal for industrial fundamentals.
The U.S. Census Bureau and HUD released new residential sales data for May 2026 on June 24. New single-family home sales fell 7.3% from April to a seasonally adjusted annual rate of 580,000 units, coming in 6.8% below the May 2025 pace of 622,000. At 580,000 units, this is the second weakest monthly reading since 2022. Inventory rose to 496,000 units, representing 10.3 months of supply, up from 9.3 months in April. The median sales price edged up 2.0% month over month to $424,900 but was essentially flat year over year, consistent with builders leaning on incentives and rate buydowns to sustain demand. Note that the reported monthly changes carry wide confidence intervals and the directional shifts may be less definitive than the headline numbers suggest.
The 10.3 months of supply is well above the 6-month threshold historically associated with a balanced market, and flat year-over-year pricing points to builders absorbing cost pressure rather than passing it through. That margin squeeze limits new starts and keeps the single-family pipeline thin going into the back half of 2026. What makes this reading notable is that new homes had been carrying more of the demand load as the existing market stayed locked up by the rate lock-in effect. With new home sales now also weakening sharply, there is no longer a clear release valve in the for-sale market. That broad softness reinforces rental demand at the margin, but the same affordability constraints suppressing ownership demand also cap how much rent growth the market can realistically absorb.
GDP and Personal Income & Outlays
The Bureau of Economic Analysis (BEA) released its third estimate of Q1 2026 gross domestic product (GDP) on June 25, revising real growth up to 2.1% annualized from the second estimate of 1.6%. The revision was driven primarily by a downward revision to imports rather than stronger domestic demand. Real final sales to private domestic purchasers, a cleaner read on underlying demand, were revised down to 1.7% from 2.4%. The Q1 personal consumption expenditures (PCE) price index rose 4.6% year-over-year and core PCE rose 4.4%, both revised up slightly from prior estimates.
Also released June 25, the May Personal Income and Outlays report showed nominal personal income up 0.7% on the month, but real disposable personal income (DPI) increased only 0.3% as inflation offset nominal gains. Nominal PCE rose 0.7% while real PCE rose just 0.3%. The May headline PCE price index was up 0.4% month-over-month and 4.1% year-over-year; core PCE rose 0.3% on the month and 3.4% year-over-year. The personal saving rate fell to 3.0%.
The two reports together describe a stagflationary backdrop: real demand is softer than the GDP headline suggests, inflation remains well above target, and the consumer's financial cushion is thin. With Q1 core PCE at 4.4% annually and May core PCE running at 3.4% annually, the Federal Reserve (Fed) has little room to cut, keeping borrowing costs elevated and the 10-year Treasury biased higher. For CRE, cap rate compression stays off the table and floating-rate refinancings remain under stress. A 3.0% saving rate with real income barely growing raises concerns about tenant health in consumer-facing sectors, where spending resilience looks increasingly credit-driven.
The University of Michigan released its final June Consumer Sentiment Index on June 26, coming in at 49.5, up 10.5% from May's 44.8 but down 18.5% year over year. Current conditions rose to 47.7 and the expectations component jumped to 50.7, a 15.0% monthly gain. The rebound was broad-based across income, wealth, and political affiliation, driven largely by easing fears over long-term economic consequences of the Iran conflict. Even so, sentiment remains 13% below its February pre-conflict level, with more than half of consumers citing high prices as a drag on personal finances for the third straight month.
Consumer inflation expectations ticked down but remain elevated: year-ahead expectations fell to 4.6% from 4.8% in May, still well above the 3.4% February reading, while long-run expectations pulled back from 3.9% to 3.3%, closer to the 2.8% to 3.2% range seen in 2024. The accompanying UMich chart shows gas price expectations and long-run inflation expectations have largely returned to pre-conflict levels, even as short-run expectations remain worse. Whether those expectations prove accurate will depend heavily on how the conflict and tariff environment evolve, but if long-run expectations continue to moderate, that could take modest pressure off the Treasury curve. For CRE, sentiment this depressed argues against any near-term acceleration in discretionary spending, keeping consumer-facing retail, hospitality, and experiential assets in stabilization mode with the broader capital markets backdrop largely unchanged while the Fed holds.
News
News to know
News to know
Commercial real estate liquidity is under pressure again | GlobeSt, June 22, 2026
Geopolitical tensions, weaker REIT pricing, and tightening global financial conditions are reversing recent gains in CRE capital access. Global real estate fundraising fell nearly 50% quarter-over-quarter in Q1 2026, with deal volume hitting its lowest point since early 2024. Mega-fund closes in late 2025 absorbed available LP liquidity, creating a near-term fundraising gap. North America continues to outperform globally on private real estate deal activity, supported by industrial and residential fundamentals. A more opaque Fed under Chair Warsh has further complicated investment modeling, as investors are unable to reliably forecast rate paths in an environment where the easing cycle has effectively ended.
Trump cancels bipartisan housing bill signing, demands voter ID legislation | Bisnow, June 24, 2026
President Trump canceled a scheduled signing ceremony for the 21st Century Road to Housing Act, tying it to passage of the SAVE America Act, a voter ID bill the Senate rejected earlier this month. The housing legislation passed both chambers with broad bipartisan support and included provisions to curb large institutional investors' ownership of single-family homes and streamline factory-built housing rules. House Speaker Mike Johnson indicated Trump still has a 10-day window to sign the bill and expects him to do so. Whether a backroom agreement materializes or Trump moves to veto remains unclear, and housing advocates say the outcome is difficult to predict.
New York State enacted a pied-a-terre tax on May 26 targeting city residential properties not listed as primary residences. Phase one, effective July 1, 2026 through June 30, 2028, levies rates of 4% to 6.5% on properties assessed at $1 million or more. Phase two, running 2028 to 2031, applies an annual fee on second homes valued above $5 million. The city comptroller estimates the tax will generate $500 million annually. Luxury contract activity has not yet shown a negative reaction: 131 Manhattan contracts were signed for properties valued at $4 million and above between May 25 and June 21, 2026, compared with 126 over the same period a year earlier. Industry observers note the tax has not yet taken effect, and its true impact on development pipelines and buyer behavior will take months to assess. Concern centers less on near-term sales than on the longer-term chilling effect on high-end condo development, which has been one of the few active construction segments in the city.
The Massachusetts Supreme Judicial Court struck down a ballot measure that would have allowed voters to approve statewide rent control in November, ending the most expansive effort in years to repeal the state's three-decade ban. The proposal would have capped annual rent increases at the rate of inflation, with a 5% ceiling, and included exemptions for small landlords and buildings under 10 years old. The court ruled the measure unconstitutional due to its exemption for units in religious facilities, a provision that ran afoul of the state constitution's limits on ballot petitions. Real estate owners, developers, and institutional landlords backed the opposition campaign. Massachusetts average two-bedroom rents run roughly $2,580 per month, 44% above the national average. Proponents indicated they would continue pursuing rent regulation through state legislation, though the Democratic-controlled legislature has previously declined to lift the existing ban.
Big banks pass Fed stress test, quickly boost payouts | Bloomberg, June 24, 2026
All 32 large U.S. banks cleared the Federal Reserve's 2026 annual stress test, which modeled a severe global recession including a 39% decline in commercial real estate prices, a 30% drop in house prices, and unemployment peaking at 10%. Despite absorbing a hypothetical $708 billion in total loan losses, aggregate capital declined only 1.6 percentage points, remaining above minimum requirements. JPMorgan, Goldman Sachs, and Morgan Stanley announced dividend increases shortly after results were released. Unlike prior years, the 2026 results will not affect capital requirements as the Fed continues overhauling the exam framework, which includes giving banks early visibility into scenarios and freezing stress capital buffer requirements through 2027. Critics argue the changes have weakened the test's effectiveness as a safeguard against systemic risk.
Fannie and Freddie take on more rate risk as portfolios grow | Bloomberg, June 25, 2026
Fannie Mae and Freddie Mac have added more than $135 billion to their retained portfolios over the past year as part of the Trump administration's push to lower mortgage rates by reducing the supply of agency MBS available to investors. The strategy has widened both firms' duration gaps to roughly one year, leaving them more exposed to rate swings. A 50 basis point increase in rates would reduce Fannie Mae's portfolio value by approximately $1.2 billion and Freddie Mac's by more than $1.6 billion. Both firms have left much of the added rate exposure unhedged to avoid derivatives trades that could put upward pressure on Treasury yields. Analysts expect portfolios to keep growing, with duration gaps likely widening alongside them.
NYC Rent Guidelines Board approves rent freeze | Wall Street Journal, June 25, 2026
New York City's Rent Guidelines Board voted 7-1 to freeze rents at 0% on one- and two-year leases for roughly one million rent-stabilized apartments, effective October 1. The decision fulfills Mayor Zohran Mamdani's campaign pledge and follows his appointment of six board members in February. The New York Apartment Association warned the freeze could force landlords with mixed portfolios to raise market-rate rents to offset lost income and put some properties at foreclosure risk. Legal challenges are expected, as the board is required by law to weigh operating costs in its annual determination. Mamdani's administration has offered partial relief through a new city-backed insurance program targeting a 20-30% reduction in landlord premiums and a $5 million loan program to cover tenant arrears.
INSIGHTS Spotlight
Catch the latest research and insights from Altus
Podcast | Fed shifts, ROAD to Housing ACT, and commercial real estate as an inflation hedge
For their 100th episode of the CRE Exchange podcast, Omar Eltorai and Cole Perry cover three topics relevant to the US CRE landscape right now.
First, the "new" Fed era: Kevin Warsh's first meeting at the helm of the US central bank did not bring any change to rates, but sent strong signals that major changes lay ahead (many task forces, less transparency, potentially new preferred measures); markets are pricing rate hikes through end of year.
Second, the Road to Housing Act has cleared both chambers, but a Presidential signing is now in question. The episode breaks down what the institutional SFR ban, the build-to-rent provisions, and the supply-side reforms mean for investors if and when it becomes law.
Third, Omar shares findings from forthcoming research re-examining the effectiveness of CRE as an inflation hedge, and where the data says it does and doesn't hold up.
Article | How much does inflation distort the trend toward larger CRE deals?
Not every trend in CRE data is what it appears to be.
The share of US CRE transaction value coming from large deals (those exceeding $10 million) has been rising. It's widely read as a sign of returning institutional confidence. But the $10 million threshold defining a "large deal" is not often adjusted for inflation, and in real terms, that bar is meaningfully lower today than it used to be.
Adjust for it, and the picture changes: in some sectors, the trend holds; in others, it nearly vanishes.
Important dates
Upcoming data releases and events
Data releases (Times in EST)
Tuesday, June 30
9:00 AM: S&P Case-Shiller Home Price Index (Apr)
9:45 AM: Chicago PMI (Jun)
10:00 AM: Consumer Confidence (Jun)
10:00 AM: Job Openings & Labor Turnover Survey (May)
Wednesday, July 1
8:15 AM: ADP Employment Report (Jun)
9:45 AM: US Manufacturing PMI (Jun)
10:00 AM: ISM Manufacturing PMI (Jun)
10:00 AM: Construction Spending (May)
Thursday, July 2
8:30 AM: Weekly Jobless Claims (Jun 27)
8:30 AM: Employment Report (Jun)
8:30 AM: Unemployment Rate (Jun)
8:30 AM: Average Hourly Earnings (Jun)
10:00 AM: Factory Orders (May)
Upcoming Industry Events
June 27 – June 30: BOMA International Conference & Expo (Long Beach, CA)
July 15: IMN Distressed CRE West Forum (Dana Point, CA)
July 27 – July 30: NCREIF Academy Week at SMU (Dallas, TX)
About our research team
Omar Eltorai
Senior Director of Research
Altus Group
Omar Eltorai is a Research Director at Altus Group. With more than a decade of experience in the industry in investment management and financing roles,
Omar's focus is on macro, capital and market trends affecting the US CRE market. Beyond regularly authoring articles and reports, his commentary and analysis has been featured in various media publications, including: Wall Street Journal, Globe Street, and Yahoo! Finance.
Cole Perry
Associate Director of Research
Altus Group
Cole Perry is a Associate Director of Research with Altus Group's Research team. In this role, Cole delivers key insights into macroeconomics, capital markets, and the broader commercial real estate sector.
Cole boasts a rich background in Commercial Real Estate analytics with previous roles at CompStak and Brixmor Property Group. He holds dual M.S. degrees from Columbia University in Urban Planning and Real Estate Development.
Disclaimer: The opinions expressed in this newsletter are solely those of the authors and are not endorsed by Altus Group Limited, its affiliates and its related entities (collectively “Altus Group”). This publication has been prepared for general guidance on matters of interest only and does not constitute professional advice or services of Altus Group. You should not act upon the information contained in this publication without obtaining specific professional advice. No representation or warranty (express or implied) is given as to the accuracy, completeness or reliability of the information contained in this publication, or the suitability of the information for a particular purpose. To the extent permitted by law, Altus Group does not accept or assume any liability, responsibility or duty of care for any consequences of you or anyone else acting, or refraining to act, in reliance on the information contained in this publication or for any decision based on it. The distribution of this publication to you does not create, extend or revive a client relationship between Altus Group and you or any other person or entity. This publication, or any part thereof, may not be reproduced or distributed in any form for any purpose without the express written consent of Altus Group.
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